biggerdadd

Hi. New member here (in NJ) with what is hopefully a simple question for you pros!! My buddy is turning in an '07 RX350 with 27K miles. The residual on the vehicle is $25,900. Have been looking at the CPOs on the Lexus dealers' websites and eBay motors. Seems like a CPO with less than 30K miles ranges from $29K-32K. Dealers have informed me that I can buy the vehicle from them when it's turned for the residual (they'll buy it and then I'll buy it from them). Have been researching and am torn between these two options: (1) paying for Lexus to CPO the vehicle (have been told that it should cost around $2,200--one dealer said that this in effect covers the inspection and maintenance which is around $500 and then the balance is for the warranty which is "bumper to bumper"); and (2) purchasing an extended warranty from Lexus (one dealer told me to scarp the CPO and go this route--researched Platinum plan because the vehicle is still under warranty--research indicates the dealer cost is about $1500--and extended warranties from others--Warrantydirect.com; AAA (seems a bit high--nearly $2,700 for their top of line warranty); Nation Warranty; etc....).

What do people think? Should I go CPO? Dealer claims bumper to bumper coverage is better. However, I don't trust that I'm getting the service/maintenance that I'm presumably paying for (they just going to detail the car and do an oil change or are they going to slap on new tires too and brakes, etc...). Also, how am I going to know if I'm getting what I pay for?

Extended warranty--seems like you have to be careful some are bad (hard to get reimbursed, etc...) or just plain scams. Others indicate, you should take $2,000 (cost of average extended warranty) and put it in a repair account because most people who buy extended warranties don't use 'em and when the do 75% lose money because the repair(s) cost less than the warranty cost. What do the pros think? Do I need to lay out the cash for either option or am I safe with a car with low miles that has been well cared for? Lexus maintenance history for RX350 '07 is really good on Consumer Reports (only negative is the audio--is that a real concern?).

Thanks!!!

LexFather

Welcome to Clublexus. There is no "paying" for CPO, that dealer is nuts. The Dealer certifies the car BEFOREHAND, they don't wait for customers to pay to certify it. They have a regional rep come and do the final checkover to make sure the car passes Lexus stringent guidelines. The reason for this is obvious as you know/stated, the car is pretty much warrantied for 100k miles.

I had an extended warrenty on my GS 400 I bought with 16k miles years ago. WHen it needed warrenty work after the 50k, it was covered and I didn't have any issues.

I would go with the extended warrenty in this decision. Everyone if I am wrong, please chime in!

biggerdadd

Thanks 1Sicklex! The way the dealer explained it to me is that they take in the car and then do all of the work to CPO it. Then they sell it. When I researched I saw that a CPO'ed vehicle with similar mileage was "listing" with dealerships at around $32K. Guess they buy it for residual CPO 'em and tack on a few grand. I would be buying it at residual and then paying the cost for the CPO (i.e., work and warranty). This means I wouldn't pay the mark up (aside from what they'll tack on to the CPO process). Think I've got this right. Please correct me if I'm wrong, pros. Still stuck--CPO v. extended warranty or just buy it, have it detailed and then ride out the remainder of the warranty and pay for repairs if they arise. Thanks!!!

LexFather

Oh gotcha. Well considering the market is where it is I would play hardball to get the price you want. That is a solid price for a 07 RX, does it have NAV?

IS-SV

I agree, if you want CPO and the only decent warranty that goes with it, negotiate accordingly.

When I bought my CPO 07 IS350, during the price negotiations they offered to remove the CPO warranty only (not the CPO certification obviously) to get to the right price. I refused and they met my price later that day with the CPO warranty included.

tex2670

you just want to make sure you get a copy of the extended warranty terms and conditions. I had one on my Acura years ago, from Honda Financial, and there were lots of exclusions, and a $50 "deductible" for any repair.

ekc

iTrader: (6)

If I were you, I would just buy the car from your buddy and buy the extended warranty separately. The Platinum program is Bumper to Bumper and they cover up to 7years / 100k total miles from the original sale date; plus it can be transferrable (once, to the next owner). There are dealers that offer extended warranties at 40% off so you can potentially get the same deal as a CPO for under $27k...

mmarshall

I'll second that welcome to ClubLexus with 1SICKLEX (Mike).

True, there is no "paying" for a dealer to actually certify (CPO) a used car (it has to be within a certain age/mileage envelope, of course). However, a CPO usually DOES cost more, as a used car, if you actually go buy one off the lot as a customer. That is because the dealership (supposedly) goes down a long list inspecting and correcting wear/maintenance/cosmetic appearance issues (usually around 150 items or so) before the car is put up for resale. A special CPO warranty also goes along with with it that is much longer then for typical non-CPO's.

Are CPO's actually worth the extra money over a standard used car (usually around $600-800)? As with any used car, I would inspect one carefully before buying one. In general, most of them are in pretty good condition, but I have seen a number of CPO's I have not been impressed with. It is one thing to have a long "list", on paper, of manufacturer-required check-items on a CPO; quite another, of course, for the dealership to take the time and expense and actually DO them.

So......am I saying that dealerships label and sell "CPOs" without actually doing the extra inspection and work? In general, no......the used-car buisness, in general, is much more honest than it used to be, but occasional shady practices still exist.....and not every dealership is run by honest people. I would look over and test-drive any used car carefully before buying one.

biggerdadd

Thanks to you all for your help. Through another Lexus forum website I found a Lexus finance person, Toby Rivers, with a Lexus dealer in Shreveport, LA. He indicated he can sell me the Lexus Platinum extended warranty for the RX350 for $1,445. This would be at least $750 less than the CPO and I wouldn't need to sign up for it right away ('cause the vehicle has a 4 year warranty and we're in year 3+). He told me to get him the VIN and he'll find of the date of service to ensure I don't miss out on the window. He also indicated the Lexus Platinum warranty I purchase from him is good everywhere (they apparently give you a card that is good at ANY Lexus dealer). The wife is pushing me for the CPO though. I indicate I can purchase, detail it and then buy the extended warranty. I've decided to play it by ear and negotiate with them at the dealership (if they'll put on 4 new tires when they CPO it I might do it because that will just about even out the price, i.e., extended warr. + tires = CPO price). How does that sound??? Thanks again too!!!

biggerdadd

ekc--do you have any contact info. on those dealers selling 'em for 40%. Found one guy in LA (not CA!!!) selling one for $1,445--Lexus site indicates MSRP is $2,000. Thanks!!!

biggerdadd

Update--decided to just buy the vehicle and will get an extended warranty before the 4 year mfr's warranty expires (with the 1 year remaining that will give me an add'l 3 years which means I'll have 4 years of coverage--the CPO would have only given me 3 years from purchase). On a very disturbing note, was in contact with TriCounty Lexus in Little Falls, NJ for past week advising them what I planned to do, i.e., buddy turn in leased vehicle and I would buy for residual and then decide whether or not to CPO or extended warr. Went today and when informed them I did not want to CPO so they started playing games (felt like I was in a low end used car lot with the line of BS they were feeding me) and refused to honor agreement (they told me they would not just sell it to me but needed to charge me $110 for detailing, $450 for "safety inspection" and oil change and $795 for commission--oh, and there would be no CPOat that price!). When I contacted Lexus Nat'l customer service, the rep. indicated that their conduct was very "UnLexus like"! Buddy took vehicle back and we went to Warnock in Whippany--they sold me the car at residual no questions asked and no BS. Class acts!! Be warned, stay away from TriCounty!!! Thanks to all of you for your help.

LexFather

Thanks for the update and congrats!

IS-SV

Interesting final outcome and glad it worked out, although it's sad to hear about behavior of the one Lexus dealership.