PCP: How many people actually pay the balloon
Discussion
daemon said:
I would say there was £2,000 contribution at the 10.9% rate, however to flipped you on to a 5.9% rate (possibly with a different company) you didnt get the cashback offer. You didnt "negotiate down" on the 10.9% offer, they simply moved you to a different finance offer probably with a different company.
Its not smoke and mirrors if the rates are there and being advertised, and you've already negotiated effectively on the price of the car.
Interesting as they always appear to sell it as a package deal - its what I would do shoe on the other foot. They know their overall margin based on finance kickback. new car sale profit and any likely profit loss on PX? Very good to know your finance point though - will try the EU approach and only agree to move on to discuss finance once we know the cost of the car and value of part ex! Its not smoke and mirrors if the rates are there and being advertised, and you've already negotiated effectively on the price of the car.
Edited by daemon on Tuesday 24th October 13:13
I also don't think franchised BMW dealers sell finance other than BMW's own Alphera finance? So really its all just juggling stuff around for that cost per month reveal v cost upfront. Magic!
Rawwr said:
HumanDoing said:
The government controls who heads the Bank of England, which sets interest rates. Control by any other name.
Why haven't you told me what's so bad about my PCP deal yet? I asked nicely..Mark-C said:
Hello HumanDoing - I’m intrigued ... why does this all bother you so much? I wouldn’t dream of buying a car on PCP because I don’t like new cars but I couldn’t give a toss what other people do. So what’s up?
Ken Figenus said:
Interesting as they always appear to sell it as a package deal - its what I would do shoe on the other foot.
Yes, it suits them too. Ultimately they want to reduce your car down to "only £X a month over X months". If they do that you've ultimately no idea how much discount you got, how good a deal the finance is and how much you got for your trade in. I break all three out and price around for each (if they are required). Ultimately the odds of any given dealer giving you the most discount AND the best finance deal AND the most for your trade in are very low.Ken Figenus said:
They know their overall margin based on finance kickback. new car sale profit and any likely profit loss on PX? Very good to know your finance point though - will try the EU approach and only agree to move on to discuss finance once we know the cost of the car and value of part ex!
There shouldnt be any profit loss on the PX. They'll price it to either move it on to another trader / at auction OR to refurb it and resell it at a profit on their own forecourt or as stock for another outlet within the group.Yes, break it out. They hate it.
Ken Figenus said:
I also don't think franchised BMW dealers sell finance other than BMW's own Alphera finance? So really its all just juggling stuff around for that cost per month reveal v cost upfront. Magic!
I havent used BMW Finance in years. Last time it was branded BMW Finance though. I think I think the dealers are targeted on a certain percentage of sales going through BMWs own finance companies but where that isnt palatable for a customer they'll farm it out to other finance companies.
daemon said:
At no point can they say "ah but hang on, we cant give you this discount now as you're taking out the manufacturers 0% finance offer". That is illegal.
This is how the cunningly named "manufacturer contribution" came about. Playing semantics with the law. A manufacturer contribution is completely totally and utterly different to a discount. Oh yes.Rawwr said:
HumanDoing said:
The government controls who heads the Bank of England, which sets interest rates. Control by any other name.
Why haven't you told me what's so bad about my PCP deal yet? I asked nicely.Look at Rawwr's deal, and tell the PH collective how he could have got a better deal, and how PCP is failing him so badly here. if you can do that, I will gladly listen with complete neutrality.
48k said:
daemon said:
At no point can they say "ah but hang on, we cant give you this discount now as you're taking out the manufacturers 0% finance offer". That is illegal.
This is how the cunningly named "manufacturer contribution" came about. Playing semantics with the law. A manufacturer contribution is completely totally and utterly different to a discount. Oh yes.daemon said:
Indeed. And it helps the manufacturer protect residuals too. I remember at one point some years ago mercedes were offering something like £12,000 of a manufacturers contribution to their finance deal. If they just simply lobbed that off as discount it would have destroyed the value of used ones on their dealers forecourts.
Some years ago? Current offer for S63 with £15750 deposit contributionThat's the first one I looked at, there's more:
£17k on the CLS63 coupe, S63AMG, CLS63 SB, S63 Cab
£16.5k SL63
£11k on the G63
HumanDoing said:
Also I think you're confusing me with someone else as I haven't brought up a crash ... what I can say is that interest rates won't rise to 10% if/when we have another crash ... with the way the economy is set up now, punishing debtors and putting downward pressure on house prices is the last thing any government would do.
Apart from this time when you did?HumanDoing said:
I assume you're referring to, for example, £200,000 in the bank netting 5% every year on stock returns and that beating the cost of a PCP (potentially).
So do all these financial hotshots 'know' that their stocks are going to increase in worth and that there won't be a crash around the corner? The market is due a huge correction soon, I wonder where all these self-important gas bag 'I make more investing it' posters will be when their stake is now worth less than the original investment? It's the self-importance that I always find bewildering.
So do all these financial hotshots 'know' that their stocks are going to increase in worth and that there won't be a crash around the corner? The market is due a huge correction soon, I wonder where all these self-important gas bag 'I make more investing it' posters will be when their stake is now worth less than the original investment? It's the self-importance that I always find bewildering.
djc206 said:
daemon said:
Indeed. And it helps the manufacturer protect residuals too. I remember at one point some years ago mercedes were offering something like £12,000 of a manufacturers contribution to their finance deal. If they just simply lobbed that off as discount it would have destroyed the value of used ones on their dealers forecourts.
Some years ago? Current offer for S63 with £15750 deposit contributionThat's the first one I looked at, there's more:
£17k on the CLS63 coupe, S63AMG, CLS63 SB, S63 Cab
£16.5k SL63
£11k on the G63
Rawwr said:
I really wish he'd just answer my question 
Apologies, I'm sure you'll appreciate I have a lot of people demanding my time these days (on this thread alone in fact) - can you repeat what your question was and I'll be very happy to offer a considered response. Regards,
HumanDoing.
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