The shortage of new vehicles has created high demand for used vehicles, especially late model, “nearly new” cars and trucks that most closely meet the needs of consumers unable to buy new. Certified pre-owned (CPO) vehicles are increasingly popular, as they provide buyers documentation that the vehicle has been thoroughly inspected and maintained or repaired to meet certification guidelines. With CPO sales projections projected to reach 2.8 million units in 2022, according to Cox Automotive, this segment of the market is facing supply issues as well.
“Sourcing potential CPO vehicles may be a challenge right now as the primary sources for these quality, low mileage vehicles are rental car companies and leases, both of which were negatively impacted by COVID,” stated Dominic Limongelli, president and COO, ProGuard Warranty. “Every dealership is fighting for the same inventory, increasing procurement costs and reducing margins. Dealers need to find a way to drive customers to their lot to make that money back, and CPO can do that.”
ProGuard recently teamed up with the National Independent Automobile Dealers Association (NIADA) to serve as an administrator for its newly revamped NIADA Certified program. “When NIADA approached us about its CPO program, we felt it was a perfect collaboration because we share a common objective of helping the independent dealer succeed,” said Limongelli. “By providing documentation as to the certified state of a vehicle, you are holding that vehicle and your lot up to a higher standard. Having the validation of a respected third-party association adds an extra level of comfort to customers, helping them feel extremely confident in their purchase.”
NIADA vice president of member services James Gibson said NIADA Certified gives independent dealers the chance to compete on a level playing field in the most popular and profitable segment of the used vehicle market. “Customers are searching for certified vehicles and this program gives our members the tools to deliver on customer demands,” he stated. “We sought out the most trusted names in the industry for our program administrators and ProGuard’s reputation for transparency, customer service and claims payment made it a great fit.”
ProGuard found the substance behind the program appealing, particularly its integration with Carketa, which provides a 200-point digital inspection and condition report for all NIADA Certified vehicles. This dovetails well with ProGuard’s goal of protecting the customer and the dealer’s reputation by providing additional value. “Dealers who offer NIADA Certified vehicles show they are willing to go the extra mile to provide customers peace of mind with their purchase,” Limongelli explained. “It’s important to stand out in today’s competitive marketplace and this program does so while increasing dealer profitability. It’s a win-win for everyone.”