When did new cars become so expensive?
Discussion
soxboy said:
10 years later in 2002 when that was going to start costing money (heater matrix IIRC) mum got another one, again 1.2 but new shape with electric windows, remote locking, 4 airbags - delivery mileage £5995.
In 2003 we p/x'd a 1998 Clio 1.6RXE which cost about £11K new and the value was really hit by the cheap new Clios that were available. Who would pay £5K retail for a 5yr old Clio when a new one is only a bit dearer? Buyers don't see the spec difference, and the 1.6 engine on ours was a disadvantage too.The car was £4Kish in Glasses but every garage we went to said it was "over book". Some dealer offered under £3K. We eventually got a bit more but not much.
The amazing thing about that car (being a Renault) was it was faultless in 5 yrs save for breaking both rear springs at 4yrs - and Renault replaced those FOC!
J4CKO said:
I always ponder this,
There is always a reason why someone has a given car, here are some possible scenarios
Company Cars
Finance
Inherited Money/Trust Funds
Bonuses
Lottery Winners or freinds/relatives of lottery winner.
Very High Earners on PAYE
Company owners
Double income, no kids
Lives with parents, spends all money on a car
Those who operate in the cash economy and is spared the tiresome burden of PAYE
Benefits cheats (as per tv programme Monday Night, Z4's, Mercs etc)
Self Employed/Contractors (how I paid for mine, now sadly PAYE)
Criminal fraternity (Cheshire Has its fair share of outwardly respectable Gangsters)
Ragged edge financing, i.e. bills not payed but nice car, designer clothes, holidays.
Also empty nesters or retired folk. Plenty of old duffers out there who dutifully turn up at their local Ford/VW/Jap dealer every three years and pay full list price for a new Fiesta/Polo/Jazz/Yaris.There is always a reason why someone has a given car, here are some possible scenarios
Company Cars
Finance
Inherited Money/Trust Funds
Bonuses
Lottery Winners or freinds/relatives of lottery winner.
Very High Earners on PAYE
Company owners
Double income, no kids
Lives with parents, spends all money on a car
Those who operate in the cash economy and is spared the tiresome burden of PAYE
Benefits cheats (as per tv programme Monday Night, Z4's, Mercs etc)
Self Employed/Contractors (how I paid for mine, now sadly PAYE)
Criminal fraternity (Cheshire Has its fair share of outwardly respectable Gangsters)
Ragged edge financing, i.e. bills not payed but nice car, designer clothes, holidays.
excel monkey said:
Also empty nesters or retired folk. Plenty of old duffers out there who dutifully turn up at their local Ford/VW/Jap dealer every three years and pay full list price for a new Fiesta/Polo/Jazz/Yaris.
Do they still do that? I've noticed the people around me who used to regularly change their cars haven't bothered for a couple of years. Also I wonder if the stories about them paying list are true - I daresay some do, but most old people are pretty hard-faced.The thing is, 20-25k is a serious wedge of cash, well it used to be in car circles, now its entry spec for basic hot hatches.
It'd mad, i earn a reasonably good wage for my age, and most would assume a single man, with no independents and usual bills to pay could go and have something like a golf GTI or similar, but when that golf comes in at about £400 a month on finance, its ridiculous.
especially when you look at what they are worth in 2-3 years, when i looked at a Focus RS just out of curiosity, the PCP was working out at about £425 a month, with £3k as deposit, and the GFV was less than half the value of the car!! that's shocking, especially given fuel, tyre and tax bills for such a thing.
and the Focus RS was actually 'cheap' compared with a golf GTI with a few options ticked like xenons, a pack an leather etc. scary biscuits!
It'd mad, i earn a reasonably good wage for my age, and most would assume a single man, with no independents and usual bills to pay could go and have something like a golf GTI or similar, but when that golf comes in at about £400 a month on finance, its ridiculous.
especially when you look at what they are worth in 2-3 years, when i looked at a Focus RS just out of curiosity, the PCP was working out at about £425 a month, with £3k as deposit, and the GFV was less than half the value of the car!! that's shocking, especially given fuel, tyre and tax bills for such a thing.
and the Focus RS was actually 'cheap' compared with a golf GTI with a few options ticked like xenons, a pack an leather etc. scary biscuits!
Lucas Ayde said:
But it never really has made economic sense to buy a car new - it's just a luxury choice. Fine if you have the money and want to treat yourself but a financially bad idea otherwise.
Quite. If it's your own money buy used, especially for anything mainstream. As true 20 years ago as it is today.
robsti said:
PCP ,interest only mortgages and equity release are all products that are going to haunt some people for years to come!
Looking forward to it - seriously - currently they all think they've made really smart decisions and I'm the mug for only buying cars that I can pay cash for - thing is I've purchased cars over the years that I wanted to drive and I've never regretted a single one, I'm not sure a povo spec brand new ashtray would even remotely float my boat......Edited to add - nope I've thought about it some more and it would be a living purgatory!!!!
Ok then. Help explain why this is a bad idea.
I've always bought used cars in the past but now think a PCP deal could be a sensible option. I've got an older TDCI Focus that I can't see myself keeping on the road for the next three years. I've considered used Type Rs and Focus RSs as replacements but put off by potential running and maintenance costs. I’m interested in a Twingo Cup.
I could do the following:
1. Buy a used 3 year old car with 25kmiles on the clock for 8k. However I’m then out of warranty and would need a 5k loan.
2. Fund a 11k new Twingo with 3k deposit for £130/month. Approx £5k after 3 years but then likely to be in a position to buy used or pick up whatever type of deals there may be then.
Option 2 would appear to give a new car with manufacture warranty, unlikely to need much other than basic service. Also the difference in new and 3 years old is only 3k so not massive depreciation.
What am I missing?
I've always bought used cars in the past but now think a PCP deal could be a sensible option. I've got an older TDCI Focus that I can't see myself keeping on the road for the next three years. I've considered used Type Rs and Focus RSs as replacements but put off by potential running and maintenance costs. I’m interested in a Twingo Cup.
I could do the following:
1. Buy a used 3 year old car with 25kmiles on the clock for 8k. However I’m then out of warranty and would need a 5k loan.
2. Fund a 11k new Twingo with 3k deposit for £130/month. Approx £5k after 3 years but then likely to be in a position to buy used or pick up whatever type of deals there may be then.
Option 2 would appear to give a new car with manufacture warranty, unlikely to need much other than basic service. Also the difference in new and 3 years old is only 3k so not massive depreciation.
What am I missing?
7 Sevens said:
What am I missing?
You're not comparing like with like. A 3 yr old Twingo which cost £11K new won't be worth £8K at 3yrs old.However I think buying a cheapish new car on a manufacturer PCP vs a 3yr old car where you're always taking a bit of a chance is hard to argue against.
Disadvantage of PCP is you're pretty stuck with it for the term - you can get out of them but you might lose a lot of money, and the mileage is limited so if something changes in your life and your mileage increses a lot then that could get expensive (you can avoid the excess charge by buying the car at the end of the term though).
7 Sevens said:
Ok then. Help explain why this is a bad idea.
I've always bought used cars in the past but now think a PCP deal could be a sensible option. I've got an older TDCI Focus that I can't see myself keeping on the road for the next three years. I've considered used Type Rs and Focus RSs as replacements but put off by potential running and maintenance costs. I’m interested in a Twingo Cup.
I could do the following:
1. Buy a used 3 year old car with 25kmiles on the clock for 8k. However I’m then out of warranty and would need a 5k loan.
2. Fund a 11k new Twingo with 3k deposit for £130/month. Approx £5k after 3 years but then likely to be in a position to buy used or pick up whatever type of deals there may be then.
Option 2 would appear to give a new car with manufacture warranty, unlikely to need much other than basic service. Also the difference in new and 3 years old is only 3k so not massive depreciation.
What am I missing?
Well, obviously if the car has only lost 25% of list price in 3 years then it has a stronger case for buying new. In option 2 surely you would be a mug not to pay the balloon payment assuming it wasn't much more than 3k. You would have already sunk 8k into the car and don't own it. You pay the balloon and then sell the car worth 8k@3 years old. Maybe I'm missing something, never had a PCP. I've always bought used cars in the past but now think a PCP deal could be a sensible option. I've got an older TDCI Focus that I can't see myself keeping on the road for the next three years. I've considered used Type Rs and Focus RSs as replacements but put off by potential running and maintenance costs. I’m interested in a Twingo Cup.
I could do the following:
1. Buy a used 3 year old car with 25kmiles on the clock for 8k. However I’m then out of warranty and would need a 5k loan.
2. Fund a 11k new Twingo with 3k deposit for £130/month. Approx £5k after 3 years but then likely to be in a position to buy used or pick up whatever type of deals there may be then.
Option 2 would appear to give a new car with manufacture warranty, unlikely to need much other than basic service. Also the difference in new and 3 years old is only 3k so not massive depreciation.
What am I missing?
Thanks for your thoughts
Deva. I appreciate the like for like comment but with only a £3k difference in value then in this example the PCP seems the sensible option. However that’s a very un PistonHead thing to do so struggling to get my mind around it. Good point on the mileage, hadn’t realised you could buy it and avoid the excess charges. Still at the very early consideration stage of all this.
SSBB. That’s the other attraction. Final payment of around £5k so I could make back some of the 8k I’ve spent in the first three years. Perhaps 2k which means £6k ‘depreciation/spend’ over 3 years.
Deva. I appreciate the like for like comment but with only a £3k difference in value then in this example the PCP seems the sensible option. However that’s a very un PistonHead thing to do so struggling to get my mind around it. Good point on the mileage, hadn’t realised you could buy it and avoid the excess charges. Still at the very early consideration stage of all this.
SSBB. That’s the other attraction. Final payment of around £5k so I could make back some of the 8k I’ve spent in the first three years. Perhaps 2k which means £6k ‘depreciation/spend’ over 3 years.
7 Sevens said:
Thanks for your thoughts
Deva. I appreciate the like for like comment but with only a £3k difference in value then in this example the PCP seems the sensible option. However that’s a very un PistonHead thing to do so struggling to get my mind around it. Good point on the mileage, hadn’t realised you could buy it and avoid the excess charges. Still at the very early consideration stage of all this.
We tend to buy new and keep for 5-6 yrs. So the new car makes more sense to me, but in your comparison it's still £100/mth more expensive.Deva. I appreciate the like for like comment but with only a £3k difference in value then in this example the PCP seems the sensible option. However that’s a very un PistonHead thing to do so struggling to get my mind around it. Good point on the mileage, hadn’t realised you could buy it and avoid the excess charges. Still at the very early consideration stage of all this.
7 Sevens said:
SSBB. That’s the other attraction. Final payment of around £5k so I could make back some of the 8k I’ve spent in the first three years. Perhaps 2k which means £6k ‘depreciation/spend’ over 3 years.
Maybe, but unlikely - look at the price of 3yr old Twingos. Bear in mind you'll be selling privately so you can't ask as much as a dealer can.Gassing Station | General Gassing | Top of Page | What's New | My Stuff