Kia Canada’s CPO program is part of the growth process

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To every thing there is a season. And this is the season for Kia’s CPO program.

“Our CPO program is part of the evolution of the brand. We want to focus on increasing the quality of the vehicles we are selling used,” Robert Staffieri, Kia Canada’s national customer retention manager, told Canadian AutoWorld. “We want to widen our customer base.”

The logic is simple enough: If consumers enjoy life at the wheel of a used Kia, they will eventually turn to a new one.

Staffieri said the latest J.D. Power retail satisfaction survey showed that 75 per cent on shoppers who considered buying a Kia did so. And the certified used program, started nearly 12 months ago, gives them another reason.

As well, it’s also a good tool to help keep up the residual value on lease returns, which are the prime participants in the program.

To make the grade, a candidate must be no more than six years old, have no more than 120,000 km on the clock and have been sold in Canada.

And since only Kia dealers can take part in the program, only vehicles returned to a Kia dealer are eligible.

Any Kia with an accident history of over $3,500 will flunk out.

Then the vehicle undergoes what Kia boasts is a “rigorous” multipoint inspection and repairs.  

Among other things, each CPO comes with the following: a seven-day/1,000 km “no-hassle” exchange privilege; a CarProof history report; and a one year/12,000 km “comprehensive” warranty in addition to whatever remains of its original warranty.

There’s also a $500 bonus discount for any recent high school or college grad.

“We target grads. Once we get them into a Kia, we think we can have them for life,” he said.

One of the obstacles to any CPO effort is competition from the new side, where discounts often make it cheaper to buy new. The automaker thinks it’s got a solution.

“We have been able to negotiate a special rate from a couple of our CPO lenders that ranges anywhere from one to 1.5 points below the standard street rates,” he said.

To ensure dealers would buy into the program automaker’s dealer communication group fine tuned it, Staffieri said.

Dealers who refer to the program in their ads get a subsidy from the automaker.
With the program nearing its first anniversary, he said Kia is pleased with dealer participation and the rise in gross profit per unit.

The short-term goal is to see CPO sales make up 25 percent of used sales. The percentage stands at 15 percent.

“KCI and Kia dealers actively promoting CPO as well as a strong supply of pre-owned Kias should help achieve this number,” Staffieri said.