New car sales 75% via PCP
Discussion
I've got two cars on PCP, and they both work for different reasons:
Car 1: there was manufacturer support for taking finance which made the total cost cheaper than purchasing with cash. This car was intended as a long term purchase. I paid the balloon and kept the car.
Car 2: Total cost of PCP was £3,800 over two years (RRP £25k). This car is going back after the PCP period. Much cheaper than a purchase.
Car 1: there was manufacturer support for taking finance which made the total cost cheaper than purchasing with cash. This car was intended as a long term purchase. I paid the balloon and kept the car.
Car 2: Total cost of PCP was £3,800 over two years (RRP £25k). This car is going back after the PCP period. Much cheaper than a purchase.
Amateurish said:
Car 2: Total cost of PCP was £3,800 over two years (RRP £25k). This car is going back after the PCP period. Much cheaper than a purchase.
Wow. That's amazing!! Good work.Do they really cost £25k?
The implied sub-10% depreciation per annum on a new car must be some kind of record!
walm said:
Dog Star said:
unrepentant said:
Here in the USA most of the major manufacturers own their own finance houses and leases are run through those sources. The 3 yr lease is usually the most attractive as it means that the dealer network has a prime stock of used inventory coming back to them still under warranty and ready for CPO status. I can't believe that the U.K. is any different?
For people who do low to mid range mileage and like a new car every 3 years leasing makes a huge amount of sense. For example, BMW 330i x drive. MSRP $43,395 plus tax. Lease for $558 per month (ave with cash down and tax rolled in) with 10k miles per year allowed. Or finance for 60 months at 2.91% = $835 per month. So after 36 months on the lease you've paid $20,088. On the loan you've paid $30,060 and owe $20,040. The car is worth $24k assuming a 55% residual. You've saved $6k by leasing , you haven't had to worry about depreciation and you're now driving a new car.
In reality if the buyer stays with the same brand he's probably flipped into a new lease after 30 or 32 months as most manufacturers offer early lease termination for repeat customers, making leasing even more attractive.
Maybe the U.K. is different but I can't think why,.
Best post on this thread, I reckon.For people who do low to mid range mileage and like a new car every 3 years leasing makes a huge amount of sense. For example, BMW 330i x drive. MSRP $43,395 plus tax. Lease for $558 per month (ave with cash down and tax rolled in) with 10k miles per year allowed. Or finance for 60 months at 2.91% = $835 per month. So after 36 months on the lease you've paid $20,088. On the loan you've paid $30,060 and owe $20,040. The car is worth $24k assuming a 55% residual. You've saved $6k by leasing , you haven't had to worry about depreciation and you're now driving a new car.
In reality if the buyer stays with the same brand he's probably flipped into a new lease after 30 or 32 months as most manufacturers offer early lease termination for repeat customers, making leasing even more attractive.
Maybe the U.K. is different but I can't think why,.
TLandCruiser said:
That's my point, I earn 55k a year and I would not want to pay £400 - £500 a month on a car, my old land cruiser keeps on ticking along and never needs anything other than a service.
So you must be taking home in the region of 3K a month after deductions, and you reckon 400 a month to drive around in a nice new car all the time is unacceptably dear? It's 2017, it's not a lot. I just find the concept that a brand new car is worth 2x a 3-year-old one mad.
Given the extremely high level of reliability these days I simply cannot justify twice the cost for what, to me, is EXACTLY the same car!!
What is wrong with a 3 year old £10,000 Golf / Focus etc ?
Most of our driving is done in an old A class merc that costs nothing, but no longer looks nice.
SystemParanoia said:
At work, those who get company cars don't get a choice of car ( but can chose colour and spec )
but 90% of them are zero contribution and only BIK to pay at around £50 per month.
I need to get myself one of those! no insurance worries, no maintenance, and 40p per mile on fuel.
People who get company cars don't get 40p mile for fuel.but 90% of them are zero contribution and only BIK to pay at around £50 per month.
I need to get myself one of those! no insurance worries, no maintenance, and 40p per mile on fuel.
KTF said:
The term 'deposit' vexes me as you never get it back. Sounds better than 'up front rental' to a marketing man though.
Cheers, this is what I thought. I think ultimately PCP comes down to what you want from a car, and people's underlying narcissistic traits.
Can they afford a £40k motor outright? No. Can they stretch to the PCP deposit and payments on one? Yes. Does it look nice on their drive? Yes. Is it one up on the Joneses? Yes. Where do I sign?
I also get, from a non-car-person's point of view, the psychological pricing of "it's £299 a month, then I don't have to worry about it". With most reliable modern motors you should get to the end of a PCP deal only having to undergone basic servicing and maybe a set of tyres. It is (or should be) headache free.
I spunked £40k in long-saved cash on a 1yo E46 M3 Convertible in 2006. It had done £12k depreciation by then and only had 8k miles on it - to me it was effectively a new car. 10 years and 80k miles into ownership it is worth a fraction of what I paid for it, and I have had some big bills along the way, but nothing earth-shattering. Tyres have been the big bill that I didn't expect to be so hefty.
Yesterday its front caliper seized - my local indie wants a not-unreasonable-but-still-a-lot-of-money £353 inc VAT to replace it. However, because I'm a PH-er and actually like doing it, I've bought the caliper piston/seal rebuild rebuild kit for 25 quid online and am going to fix it with my neighbour this weekend. We both enjoy tinkering with our motors and it gets us out of the house for a few hours away from our screaming kids. Does Average Joe want to do this though? Probably not, so he/she coughs their monthly rental and kicks back and relaxes. Horses for courses.
Edited by PurpleTurtle on Friday 6th January 11:02
Sheepshanks said:
SystemParanoia said:
At work, those who get company cars don't get a choice of car ( but can chose colour and spec )
but 90% of them are zero contribution and only BIK to pay at around £50 per month.
I need to get myself one of those! no insurance worries, no maintenance, and 40p per mile on fuel.
People who get company cars don't get 40p mile for fuel.but 90% of them are zero contribution and only BIK to pay at around £50 per month.
I need to get myself one of those! no insurance worries, no maintenance, and 40p per mile on fuel.
but they dont get the money for commuting, just for work related travel
Edit:
You're right.
Just checked the bumf on the intranet and its 14p per mile.
Fell for the BS hook line and sinker
Edited by SystemParanoia on Friday 6th January 11:13
tom2019 said:
Sheepshanks said:
There isn't any interest on a lease.
Sorry PCP..then you could just put it on the mortgage. But yeah to think of a car you can get for 15 grand I think I'd rather have that option than pay 15 grand for 3 years even if it is brand new.PurpleTurtle said:
Can they afford a £40k motor outright? No. Can they stretch to the PCP deposit and payments
I spunked £40k in long-saved cash on a 1yo E46 M3 Convertible in 2006. It had done £12k depreciation by then and only had 8k miles on it - to me it was effectively a new car. 10 years and 80k miles into ownership it is worth a fraction of what I paid for it, and I have had some big bills along the way, but nothing earth-shattering. Tyres have been the big bill that I didn't expect to be so hefty.
Yesterday it's front caliper seized - my local indie wants a not-unreasonable-but-still-a-lot-of-money £353 inc VAT to replace it. However, because I'm a PH-er and actually like doing it, I've bought the caliper piston/seal rebuild rebuild kit for 25 quid online and am going to fix it with my neighbour this weekend. We both enjoy tinkering with our motors and it gets us out of the house for a few hours away from our screaming kids. Does Average Joe want to do this though? Probably not, so he coughs his monthly rental and kicks back and relaxes. Horses for courses.
That said - your ugly bill for a brake caliper is about the same as one month's lease on a Citroen C4 Euro box. And you'll probably get off scot free for the next few months. Tyres, well they're a consumable. If you're going to drive hard, then your new lease car will need then in a year as well. If you drive like a pansy, then they'll last a lot longer!I spunked £40k in long-saved cash on a 1yo E46 M3 Convertible in 2006. It had done £12k depreciation by then and only had 8k miles on it - to me it was effectively a new car. 10 years and 80k miles into ownership it is worth a fraction of what I paid for it, and I have had some big bills along the way, but nothing earth-shattering. Tyres have been the big bill that I didn't expect to be so hefty.
Yesterday it's front caliper seized - my local indie wants a not-unreasonable-but-still-a-lot-of-money £353 inc VAT to replace it. However, because I'm a PH-er and actually like doing it, I've bought the caliper piston/seal rebuild rebuild kit for 25 quid online and am going to fix it with my neighbour this weekend. We both enjoy tinkering with our motors and it gets us out of the house for a few hours away from our screaming kids. Does Average Joe want to do this though? Probably not, so he coughs his monthly rental and kicks back and relaxes. Horses for courses.
walm said:
Amateurish said:
Car 2: Total cost of PCP was £3,800 over two years (RRP £25k). This car is going back after the PCP period. Much cheaper than a purchase.
Wow. That's amazing!! Good work.Do they really cost £25k?
The implied sub-10% depreciation per annum on a new car must be some kind of record!
No, it was a Leaf Tekna. I'm sure you can get them sub £20k. Still, good deal.
Anyone read what car this month? There was an interesting piece on depreciation. The leaf was the higest depreciating car in the uk supposedly worth something like £3468 at 36 months or 16% of its original cost.
I'd like someone to point out all these 2014 sub £3.5K leafs. If dealers really are getting stuff for the cap price according to the why car piece then they are doing rather well out of used cars. Another on the chart is the Alfa mito, worth £3300 apparently, yet cheapest 3 year old one on at is nearly £7k.
I'd like someone to point out all these 2014 sub £3.5K leafs. If dealers really are getting stuff for the cap price according to the why car piece then they are doing rather well out of used cars. Another on the chart is the Alfa mito, worth £3300 apparently, yet cheapest 3 year old one on at is nearly £7k.
Edited by irish boy on Friday 6th January 11:44
Adrian W said:
Ari said:
stuckmojo said:
I've been comparing PCP/Lease/Buy outright/bank loan/buy used for my wife's next car (218/220i convertible M Sport)
Having been to a couple of BMW dealers and looked at the figures, I am baffled as to why would anyone want to do PCP if they have other means.
The key word there is 'if'. Having been to a couple of BMW dealers and looked at the figures, I am baffled as to why would anyone want to do PCP if they have other means.
rxe said:
That said - your ugly bill for a brake caliper is about the same as one month's lease on a Citroen C4 Euro box. And you'll probably get off scot free for the next few months. Tyres, well they're a consumable. If you're going to drive hard, then your new lease car will need then in a year as well. If you drive like a pansy, then they'll last a lot longer!
Really? C4 for that? I'd expect a decent Merc for 350 a month. Tyres? A set of rears in 30K plus one minor service at 1 year old (150 quid). Actually a set of tyres does last a whole 30K lease if you get a set of winters and swap them on for (obviously) winter. They'll last two or three cars on the trot (assuming same size tyres, which worked for me).But carry on - I am "stretching" myself to make these payments, as I'm driving something I "cannot afford" and doing it "to impress the neighbours" (We only have one neighbout and he's got a Bentley Continental, so I doubt he's "impressed")
There's some b
ks spouted on this thread.Dog Star said:
rxe said:
That said - your ugly bill for a brake caliper is about the same as one month's lease on a Citroen C4 Euro box. And you'll probably get off scot free for the next few months. Tyres, well they're a consumable. If you're going to drive hard, then your new lease car will need then in a year as well. If you drive like a pansy, then they'll last a lot longer!
Really? C4 for that? I'd expect a decent Merc for 350 a month. Tyres? A set of rears in 30K plus one minor service at 1 year old (150 quid). Actually a set of tyres does last a whole 30K lease if you get a set of winters and swap them on for (obviously) winter. They'll last two or three cars on the trot (assuming same size tyres, which worked for me).But carry on - I am "stretching" myself to make these payments, as I'm driving something I "cannot afford" and doing it "to impress the neighbours" (We only have one neighbout and he's got a Bentley Continental, so I doubt he's "impressed")
There's some bks spouted on this thread.irish boy said:
Dog Star said:
rxe said:
That said - your ugly bill for a brake caliper is about the same as one month's lease on a Citroen C4 Euro box. And you'll probably get off scot free for the next few months. Tyres, well they're a consumable. If you're going to drive hard, then your new lease car will need then in a year as well. If you drive like a pansy, then they'll last a lot longer!
Really? C4 for that? I'd expect a decent Merc for 350 a month. Tyres? A set of rears in 30K plus one minor service at 1 year old (150 quid). Actually a set of tyres does last a whole 30K lease if you get a set of winters and swap them on for (obviously) winter. They'll last two or three cars on the trot (assuming same size tyres, which worked for me).But carry on - I am "stretching" myself to make these payments, as I'm driving something I "cannot afford" and doing it "to impress the neighbours" (We only have one neighbout and he's got a Bentley Continental, so I doubt he's "impressed")
There's some bks spouted on this thread.PurpleTurtle said:
What I've never really understood about the whole PCP deal in the residual value/deposit required for a new car.
Let's take a simple example. £30k car, £5k deposit, £299/month over 3 years. Doesn't exceed mileage. At the end of that 3 years, Mr Customer can either give the keys back and walk away, or strike another PCP deal. Where does he get his next deposit though? Does he need to have saved another £5k, in addition to his monthly payments, or does he have enough value in the car he's been running?
Surely his initial deposit £5,000 + (36 x £299) = £15,764 just covers the depreciation?
The car is worth (roughly) 50% residual after three years, yes?
Whenever I hear people harping on about PCP they always focus on the monthly payment. Surely they're missing the 'new deposit required every time' element. Is my man maths wrong?
Infinity dealer told me the deposit will come from brand awareness Let's take a simple example. £30k car, £5k deposit, £299/month over 3 years. Doesn't exceed mileage. At the end of that 3 years, Mr Customer can either give the keys back and walk away, or strike another PCP deal. Where does he get his next deposit though? Does he need to have saved another £5k, in addition to his monthly payments, or does he have enough value in the car he's been running?
Surely his initial deposit £5,000 + (36 x £299) = £15,764 just covers the depreciation?
The car is worth (roughly) 50% residual after three years, yes?
Whenever I hear people harping on about PCP they always focus on the monthly payment. Surely they're missing the 'new deposit required every time' element. Is my man maths wrong?
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