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CPO delivery process
- Thread starter jmcdon7230
- Start date
HankLloydRight
No Roads
To the contrary, why spend the time and money to refurbish a CPO that's just going to sit on a lot for 6 to 12 months or more? Then once sold, it's going to have to be refurb'd again.
They also don't know where any CPO is eventually going to be sold, so plenty of wear and damage can occur during transport. It's better to just leave them as-is/where-is and then transport them to the final sale location for a one-time CPO refurbishment.
Also, many CPOs are used for loaners while sitting on lots, so it only makes sense to do the CPO refurb once sold and no longer being used that way.
They also don't know where any CPO is eventually going to be sold, so plenty of wear and damage can occur during transport. It's better to just leave them as-is/where-is and then transport them to the final sale location for a one-time CPO refurbishment.
Also, many CPOs are used for loaners while sitting on lots, so it only makes sense to do the CPO refurb once sold and no longer being used that way.
Pentium2004
Former Vendor
I think I agree with @jmcdon7230 on this one. I understand Hanks point of view too but I really don't see the difference between a refurbished CPO and a brand new car sitting on the lot for 6-12 months. Some of the items that are replaced on a CPO are major repairs like drive units, brake and tires. This would have to be done anyhow and these are the type of items that won't see any wear just sitting around or getting moved. The most they should have to do after sitting around a long time is polish, wax and reinspect. The only reason I could guess that they wouldn't do it ahead of time is that they are not completely sure if it will get sold through the CPO process. They may end up at some point having a surplus of cars set aside for CPO's and I can understand not dumping any money into them if you may end up just sending to the auction because they aren't moving from stock.
Interesting. You would think that if they choose a car to post online as a CPO, that they would be pretty sure it's not going to wind up at auction. Most of the CPO listings that I've seen online don't seem to last very long. Before listing they should be inspected and if the car needs extensive and expensive repairs, just send it directly to auction. The one's listed should be ready to be delivered. Imagine going to a used car lot, choosing a car, and then they tell you that they'll check it out now since you want it and it'll be ready in about five to six weeks.
Pentium2004
Former Vendor
Most dealers have a certain time frame to move cars. Once it hits that time period they send it off to auction to clear space for another car. It may even have to do with pleasing investors as to not increase the debt. Rather than have 100 cars sitting ready with say $300,000 (just an example) total spent in repairs. They can instead use your guaranteed money to refurbish it (after you order) without showing any debt but instead it just applies to the cost of sale. They probably have more CPO cars that what we get to see online. I've heard the stories on those CPO purchases and I don't think I'll ever try that.
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Tiger
Active Member
If a CPO car sits for 6-12 months without selling, it is overpriced...
But I agree that the reason is they use the CPO fleet as loaners but then these cars get beat up by people and they end up having to likely spend even more time, effort, and expense refurbishing the cars.From what I can see, they are not really that vested or interested in selling their CPO cars. Just look at the current inventory. Other than a bunch of P85Ds, very few cars are available and the ones that are available seem to be grossly overpriced as the inventory is not moving much.
Also they keep moving cars in and out of the CPO listings, so the fact that a car disappears from the CPO listings does not necessarily mean that they sold out the car.
Their goals with the current CPO program seems to be: 1) Try to artificially hold up resale values by controlling inventory and most importantly to push people to instead order new cars 2) Use the CPO fleet as loaner cars.
With point 1: They can only do this for so long as each day their CPO fleet grows as they accept trade-ins but they are not releasing that inventory for sale based on the inventory being stagnant. Also they are sitting on likely hundreds of units of CPO vehicles that are depreciating by over $1,000 each month per unit. So the current strategy is costing them money but they have made a business decision to push new car sales at the expense of CPO profit or sales.
With point 2: While using the the CPO fleet as loaners works for Tesla for now this will cause hassles for both Tesla and CPO buyers in the long term. The reason being a segment of people who end up with these CPO loaners are going to beat the crap out of them. I was disgusted to see one well known Youtuber who races Teslas post a video of him doing burnouts and beating the crap out of a Tesla loaner he was given. That poor car is going to end up being bought by someone as a CPO.
All in all I think the current CPO program is not there to sell CPO cars in an expeditious or efficient manner and if you buy a CPO car, make sure you get a good deal because there are many bad deals out there and take the time to do a very thorough pre-purchase inspection because you never know how badly the car was abused as a loaner.
Also in the last Earnings Call, Tesla stated they plan to ramp up their CPO program to actually generate revenue so in the not too distant future I think we will see CPO inventory that is more priced to sell than steer people to buy new.
I am sure there are exceptions but based on forum posts I have read, some people have located their Tesla loaner in the CPO inventory listings. I guess you can tell quickly if a CPO you are looking at buying has been used as a loaner by checking the CarFax mileage when the car was traded in and comparing it to the current mileage.
Anyone looking to buy a CPO should definitely do this check so you know how long the car you are looking at buying might have been used as a loaner.
HankLloydRight
No Roads
I would say that must loaners are in the CPO program, but by far not all CPOs are used as loaners.
timk225
Active Member
Are CPO car prices negotiable? I'm looking into buying a CPO S 60, and it sure would be nice to get a few grand shaved off it (they want 43G for a 48K mile car), or maybe get it upgraded to an 85 battery or something.
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