CPO - Certified Pre Owned Pricing

[gb56]

Kind of new here. Am considering a 2014 and 2015 X5. Have always bought CPO and intend to this time. I have always had good luck with three year old, off-lease and CPO'd, so I have learned over time. What is throwing me a curve is the pricing for these three year old cars. If I consider that a nicely equipped 2014 x5 original MSRP was in the neighborhood of $68K and the residual at that time was right at 60%, this puts the car price at return date of $40,800 residual value, yet most if not all of the ones I find are priced from $43,000 at the low point to upwards of $46K. Most of the time the dealer buys the off-lease car from BMW financial at a price well below residual (my experience has been $4K-$6K below residual) which means that on average they are $10K or more spread between asking and own price. I spend a lot of time finding just the right car and always recognize that the dealer has to make a profit, but what has been your experience on negotiating price from these inflated prices?

BTW-I know that they say they put between $2K-$3K into these cars to CPO them, but from real experience I can tell you that they are beginning to squeeze their minimum standards very tight. I always ask for the actual mechanics paperwork that did the CPO inspections so that I can see what the tread wear is on the tires, what's left of the brake pads, did the AC reach acceptable cooling levels, etc. and have found that even if a tire is one mm within range, they don't change them. Same with brakes. So many people assume that they put new brake pads on automatically and they don't. I have also seen very low mileage CPO's that needed nothing, yet they tagged the extra CPO charges onto the price.

SO, anyone willing to share their negotiating experience working from the asking price of these cars? Thanks in advance.

[BigC986]

Cash is always easier to negotiate with because money talks. As far as financing goes, most sellers are negotiable on price depending on the condition, value, age, etc of the car. Do research and determine what the average price for the car is. When looking at the car, find things wrong such as tires, brakes, cosmetics etc and factor in repair cost. Talk the seller down after that.

[gb56]

Cash is always easier to negotiate with because money talks. As far as financing goes, most sellers are negotiable on price depending on the condition, value, age, etc of the car. Do research and determine what the average price for the car is. When looking at the car, find things wrong such as tires, brakes, cosmetics etc and factor in repair cost. Talk the seller down after that.

I would agree on your points, but I am talking about buying CPO cars from a BMW dealer. With dealers cash is sometimes less attractive than financing for obvious reasons, so in this case my method of payment is less important. It is a cash purchase, but they would prefer I finance. Cosmetically CPO cars have been touched up, buffed out and look great. Tires are just about the only thing visibly that you can make an issue of because they even repair or replace damaged OEM wheels. Where I live they have created what they call "market pricing". It is supposed to represent what the average price payed for a similar car, but I have issues with that. Included in this Market pricing data are sales/leases of cars executives that have car allowances have paid and prices that other customers that are not as diligent or care to negotiate as much as I do have paid. I believe this artificially makes the average price paid too high. I have followed Kelly Blue Book and others for years, but they seem to be moving towards supporting the dealers versus collecting data and reporting it as found.

[BigC986]

Honestly there's no sure or guaranteed answer to your question. You have a subjective opinion on how you think data is collected and used which is fine and maybe even true for all I know, but realistically if a price of a car is too high for you, and you can't talk the dealer down to a price you feel comfortable paying.........don't buy it. I mean using your logic, it seems like we should all be able to walk into a Ferrari dealership and tell them that we think the $300k price tag for a car is too high and drive away only spending $20k on the car.

[gb56]

Fair enough. I just thought there might be some additional information out there that I hadn't uncovered yet. Thanks for your replies.