McLaren Finance Questions.
Discussion
The finance company owns the vehicle at the end of the agreement and have set the GFV at a predicted value with an agreed mileage and condition at that point. Whether McLaren have supported the GFV who knows? It's for the finance co to dispose of their asset at the best possible price to make the whole deal work for them.
My car with 14k miles has a GFV of £140k in January 2022, based on the recent downward spiral in values I'm hoping it won't be worth anymore than £120k, if so, I'll buy it as I'm treating it as my own rather than a hire car which is what it really is. However, with their recent change in strategy re production numbers maybe the values will harden in which case the value could increase to a point above the GFV.
I presume the finance co will offer the car to the dealer network and if that fails maybe to auction, there sure are going to be a lot of 600LT Spiders for sale late 2021 into early 2022 when the deals finish.
My car with 14k miles has a GFV of £140k in January 2022, based on the recent downward spiral in values I'm hoping it won't be worth anymore than £120k, if so, I'll buy it as I'm treating it as my own rather than a hire car which is what it really is. However, with their recent change in strategy re production numbers maybe the values will harden in which case the value could increase to a point above the GFV.
I presume the finance co will offer the car to the dealer network and if that fails maybe to auction, there sure are going to be a lot of 600LT Spiders for sale late 2021 into early 2022 when the deals finish.
Crazy4557 said:
My car with 14k miles has a GFV of £140k in January 2022, based on the recent downward spiral in values I'm hoping it won't be worth anymore than £120k, if so, I'll buy it as I'm treating it as my own rather than a hire car which is what it really is.
Sorry, I don’t understand. Using your example above, why would you pay £140k for a vehicle worth £120k? The finance company are not going to let you buy it at any less than the GFV. Doesn’t it become a negotiation if the value of the car is lower than the GFV?
The finance company will have to sell it to someone - why not the original buyer?
If the best bid is his at £120k why wouldn’t they sell it to him?
That however would probably be too easy. In practice I suspect the finance companies have sold the risk of a lower GFV to a third party insurance company who takes on the cars themselves. I have no idea. Anyone here that can enlighten us?
The finance company will have to sell it to someone - why not the original buyer?
If the best bid is his at £120k why wouldn’t they sell it to him?
That however would probably be too easy. In practice I suspect the finance companies have sold the risk of a lower GFV to a third party insurance company who takes on the cars themselves. I have no idea. Anyone here that can enlighten us?
I love the brand, but they have destroyed the fantastic opportunity they had.
Last October when I was collecting my car after a service; they had 2 720spiders in the showroom; one just under £300k the other over @ £310k, and a guy from Aberdeen collecting his new 720spider.
I was being given the jedi Knight treatment of how a 720 spider was a serious step up and just what i needed..i just kept saying i felt that they would lose the whole value of my 650 spider in a year and thats really not my bag.
Whizz forward 9 months and every week a few spiders trickle into the main dealers with 2k miles and all around £204k....where have all these spiders been, and why the hell did they not just retail them new at £210k and retain some value instead of killing it? It was never a £300k car in the first place.
What has happened is they have reinforced the view that if you buy a McLaren new you shall be pumped to the tune of near 6 figures in a very short time and put of return customers...i genuinely hope that its just not too late with the current change of strategy.
What McLaren did with he whole 600LT issue is just mind boggling.
The LT range is supposed to be the golden ticket...maybe it was arrogance how they glossed over releasing 500 675LT spiders after initially stating there were only going to be 500 LT in total that led them to think they could just make as many 600LT models as they fancied...if so....how much has that backfired for sales and value retention.
In January, I was on the cusp of a nearly new 720 spider...but Thorney posted his video of the problems he had with one of the ones I actually looked at, then reality kicked in that by April 2021 it will be a £150k car...i just ctould not consider losing (at that price point) £75k on an already year old car, and my little peanut brain just will not allow me to sign up for paying near £50k over 2 years just to hand it back.
It made me go back to the original dream of picking up a 675LT spider as they had dropped from £300k+ late last year to just over £200k now...all the bad press re values has even dragged them down and I think they shall drop further to the £175k mark, so I will just hold off on that also and see how the dust settles.
Keeping the 650 and paying £4800 a year for the warranty is the obvious best financial choice.
Real shame they have got themselves to this almost non recoverable situation.
Also, from what I hear, finance companies are very nervous at the moment, so they are only offering low ball GFVs which then means larger deposits and larger monthly payments, thereby reducing the amount of punters able to buy, thereby reducing demand and lowering prices for all marques...it would be interesting to see what GFV you would be offered on a 2019 720 spider in 3 or 4yrs time trying to put a finance deal together.
All in all, its the perfect storm for Mclaren.
Last October when I was collecting my car after a service; they had 2 720spiders in the showroom; one just under £300k the other over @ £310k, and a guy from Aberdeen collecting his new 720spider.
I was being given the jedi Knight treatment of how a 720 spider was a serious step up and just what i needed..i just kept saying i felt that they would lose the whole value of my 650 spider in a year and thats really not my bag.
Whizz forward 9 months and every week a few spiders trickle into the main dealers with 2k miles and all around £204k....where have all these spiders been, and why the hell did they not just retail them new at £210k and retain some value instead of killing it? It was never a £300k car in the first place.
What has happened is they have reinforced the view that if you buy a McLaren new you shall be pumped to the tune of near 6 figures in a very short time and put of return customers...i genuinely hope that its just not too late with the current change of strategy.
What McLaren did with he whole 600LT issue is just mind boggling.
The LT range is supposed to be the golden ticket...maybe it was arrogance how they glossed over releasing 500 675LT spiders after initially stating there were only going to be 500 LT in total that led them to think they could just make as many 600LT models as they fancied...if so....how much has that backfired for sales and value retention.
In January, I was on the cusp of a nearly new 720 spider...but Thorney posted his video of the problems he had with one of the ones I actually looked at, then reality kicked in that by April 2021 it will be a £150k car...i just ctould not consider losing (at that price point) £75k on an already year old car, and my little peanut brain just will not allow me to sign up for paying near £50k over 2 years just to hand it back.
It made me go back to the original dream of picking up a 675LT spider as they had dropped from £300k+ late last year to just over £200k now...all the bad press re values has even dragged them down and I think they shall drop further to the £175k mark, so I will just hold off on that also and see how the dust settles.
Keeping the 650 and paying £4800 a year for the warranty is the obvious best financial choice.
Real shame they have got themselves to this almost non recoverable situation.
Also, from what I hear, finance companies are very nervous at the moment, so they are only offering low ball GFVs which then means larger deposits and larger monthly payments, thereby reducing the amount of punters able to buy, thereby reducing demand and lowering prices for all marques...it would be interesting to see what GFV you would be offered on a 2019 720 spider in 3 or 4yrs time trying to put a finance deal together.
All in all, its the perfect storm for Mclaren.
garystoybox said:
Sorry, I don’t understand. Using your example above, why would you pay £140k for a vehicle worth £120k? The finance company are not going to let you buy it at any less than the GFV.
I wouldn't do that, I'd negotiate with the finance company to buy it at the market value which I was thinking maybe around £120k. The finance company won't be able to sell it at £140k to anyone if it's only worth £120k but it could be even less, depends if this so called depression from hell actually happens.They may not sell to me though, possibly they've agreed to only sell back to the dealer network in which case it will be retailed at a much greater figure.
Crazy4557 said:
garystoybox said:
Sorry, I don’t understand. Using your example above, why would you pay £140k for a vehicle worth £120k? The finance company are not going to let you buy it at any less than the GFV.
I wouldn't do that, I'd negotiate with the finance company to buy it at the market value which I was thinking maybe around £120k. The finance company won't be able to sell it at £140k to anyone if it's only worth £120k but it could be even less, depends if this so called depression from hell actually happens.They may not sell to me though, possibly they've agreed to only sell back to the dealer network in which case it will be retailed at a much greater figure.
He loved it and did not neglect it as his plan was to try and secure a deal to purchase at the end of the term.
The purchase price they offered him was far greater than the GFV that was drawn up and indeed higher than most were for sale of a similar age / mileage at the dealers.
They also offered to extend his deal by 12months but it was 50% more than what he was currently paying a month.
So away it went.
650spider said:
My friend had a Golf R a few years back on one of the similar 2 year 'hire' deals they offered.
He loved it and did not neglect it as his plan was to try and secure a deal to purchase at the end of the term.
The purchase price they offered him was far greater than the GFV that was drawn up and indeed higher than most were for sale of a similar age / mileage at the dealers.
They also offered to extend his deal by 12months but it was 50% more than what he was currently paying a month.
So away it went.
That happened to me, got quoted a ridiculous 'end user' price so I kept an eye on the auctions as I knew it could end up there and managed to buy it for a huge reduction. They do try it on and don't want to negotiate which is a bit short sighted. He loved it and did not neglect it as his plan was to try and secure a deal to purchase at the end of the term.
The purchase price they offered him was far greater than the GFV that was drawn up and indeed higher than most were for sale of a similar age / mileage at the dealers.
They also offered to extend his deal by 12months but it was 50% more than what he was currently paying a month.
So away it went.
If it happens with this car I won't be chasing them as I'll just move on.
I am sure that Santander (McLaren Financial Services) would have took on some form of deal, along with support from McLaren to enable them to be able to give up to 70% residuals on Used cars, and 60% on new cars.
The whole reason Santander started doing these deals was to clear dealer stock, which at the time, dealers were flooded with 570S Spiders, mainly launched editions that they had been left with. With the amount of cars sat around at the time, it was quite obvious that the market was going to be flooded, resulting in high depreciation levels. You can't tell me a bank wouldn't smart enough to not see that...... hence why i believe they would've been supported by MC in some way.
The whole reason Santander started doing these deals was to clear dealer stock, which at the time, dealers were flooded with 570S Spiders, mainly launched editions that they had been left with. With the amount of cars sat around at the time, it was quite obvious that the market was going to be flooded, resulting in high depreciation levels. You can't tell me a bank wouldn't smart enough to not see that...... hence why i believe they would've been supported by MC in some way.
fridaypassion said:
The finance company in the first instance will bear the negative however I can't see how with the figures I was quoted last year they can't be manufacturer backed in some way.
So just over a year ago I did almost buy a 570. The headline price stripping out the PX was 126k however the GTV was something crazy like 102k which I knew 100% would be more than it could possibly be worth after 2 years. I predicted 80k. It was a cool rental for 2 years but I couldn't burn 50k in depreciation and payments. The deals were crazy it was 20k down and £600 per month.
In the end I got a 458 which is a bit more of a conservative gamble on depreciation. I have an 82k balloon. Bought recently so post covid I didn't think that was too bad.
You chose wisely I think So just over a year ago I did almost buy a 570. The headline price stripping out the PX was 126k however the GTV was something crazy like 102k which I knew 100% would be more than it could possibly be worth after 2 years. I predicted 80k. It was a cool rental for 2 years but I couldn't burn 50k in depreciation and payments. The deals were crazy it was 20k down and £600 per month.
In the end I got a 458 which is a bit more of a conservative gamble on depreciation. I have an 82k balloon. Bought recently so post covid I didn't think that was too bad.
OldAndTired said:
Doesn’t it become a negotiation if the value of the car is lower than the GFV?
The finance company will have to sell it to someone - why not the original buyer?
If the best bid is his at £120k why wouldn’t they sell it to him?
That however would probably be too easy. In practice I suspect the finance companies have sold the risk of a lower GFV to a third party insurance company who takes on the cars themselves. I have no idea. Anyone here that can enlighten us?
Only if the original buyer actually wants to buy it. Judging by what has been happening not many buying these , instead handing them back The finance company will have to sell it to someone - why not the original buyer?
If the best bid is his at £120k why wouldn’t they sell it to him?
That however would probably be too easy. In practice I suspect the finance companies have sold the risk of a lower GFV to a third party insurance company who takes on the cars themselves. I have no idea. Anyone here that can enlighten us?
McLarenGuru said:
I am sure that Santander (McLaren Financial Services) would have took on some form of deal, along with support from McLaren to enable them to be able to give up to 70% residuals on Used cars, and 60% on new cars.
The whole reason Santander started doing these deals was to clear dealer stock, which at the time, dealers were flooded with 570S Spiders, mainly launched editions that they had been left with. With the amount of cars sat around at the time, it was quite obvious that the market was going to be flooded, resulting in high depreciation levels. You can't tell me a bank wouldn't smart enough to not see that...... hence why i believe they would've been supported by MC in some way.
Can I say on the issues of banks .....sub prime lending ....since that fiasco and how they did it I have no trust n banks what so ever The whole reason Santander started doing these deals was to clear dealer stock, which at the time, dealers were flooded with 570S Spiders, mainly launched editions that they had been left with. With the amount of cars sat around at the time, it was quite obvious that the market was going to be flooded, resulting in high depreciation levels. You can't tell me a bank wouldn't smart enough to not see that...... hence why i believe they would've been supported by MC in some way.
650spider said:
...i just ctould not consider losing (at that price point) £75k on an already year old car, and my little peanut brain just will not allow me to sign up for paying near £50k over 2 years just to hand it back.
It made me go back to the original dream of picking up a 675LT spider as they had dropped from £300k+ late last year to just over £200k now...all the bad press re values has even dragged them down and I think they shall drop further to the £175k mark, so I will just hold off on that also and see how the dust settles.
Keeping the 650 and paying £4800 a year for the warranty is the obvious best financial choice.
Real shame they have got themselves to this almost non recoverable situation.
Also, from what I hear, finance companies are very nervous at the moment, so they are only offering low ball GFVs which then means larger deposits and larger monthly payments, thereby reducing the amount of punters able to buy, thereby reducing demand and lowering prices for all marques...it would be interesting to see what GFV you would be offered on a 2019 720 spider in 3 or 4yrs time trying to put a finance deal together.
All in all, its the perfect storm for Mclaren.
You speak my language as I too just cant get me head around paying £50K for 2 years on a car and then hand t back. Also I cant bear he idea of losing £££££££ in depreciationIt made me go back to the original dream of picking up a 675LT spider as they had dropped from £300k+ late last year to just over £200k now...all the bad press re values has even dragged them down and I think they shall drop further to the £175k mark, so I will just hold off on that also and see how the dust settles.
Keeping the 650 and paying £4800 a year for the warranty is the obvious best financial choice.
Real shame they have got themselves to this almost non recoverable situation.
Also, from what I hear, finance companies are very nervous at the moment, so they are only offering low ball GFVs which then means larger deposits and larger monthly payments, thereby reducing the amount of punters able to buy, thereby reducing demand and lowering prices for all marques...it would be interesting to see what GFV you would be offered on a 2019 720 spider in 3 or 4yrs time trying to put a finance deal together.
All in all, its the perfect storm for Mclaren.
So I guess a nice 2 -3 year old 570S is the obvious answer and just pay for the warranty .
What was the GFV on the 720 spiders when they were sold on finance ?
Matty3 said:
Back on the old depreciation- again!! - we pass this way but once 
We do indeed Matty!I think the sweet spot is the 4 Yr mark...after that depreciation has dramatically slowed from the artificially high original purchase price...its then losing manageable amounts a year...just like if you bought a new mainstream high end car from Ford or Vauxhall.
The best advice is to use it as often as you can...they lose serious money so you are as well to get fun out of it losing money, rather than keeping it in the garage losing money!
Personally, after years of experience, I will never again have a garage queen that accrues less than 1000miles a year...life is just too short to be concerned more about the value rather than enjoyment.
In previous cars, I would almost have a meltdown if I ventured out and it rained...now...i couldn't care less and indeed on Thursday specifically took the mac on a 300mile journey even though it was torrential when I set off.
650spider said:
We do indeed Matty!
I think the sweet spot is the 4 Yr mark...after that depreciation has dramatically slowed from the artificially high original purchase price...its then losing manageable amounts a year...just like if you bought a new mainstream high end car from Ford or Vauxhall.
The best advice is to use it as often as you can...they lose serious money so you are as well to get fun out of it losing money, rather than keeping it in the garage losing money!
Personally, after years of experience, I will never again have a garage queen that accrues less than 1000miles a year...life is just too short to be concerned more about the value rather than enjoyment.
In previous cars, I would almost have a meltdown if I ventured out and it rained...now...i couldn't care less and indeed on Thursday specifically took the mac on a 300mile journey even though it was torrential when I set off.
Whats made you drive it the wet now as opposed to now ?I think the sweet spot is the 4 Yr mark...after that depreciation has dramatically slowed from the artificially high original purchase price...its then losing manageable amounts a year...just like if you bought a new mainstream high end car from Ford or Vauxhall.
The best advice is to use it as often as you can...they lose serious money so you are as well to get fun out of it losing money, rather than keeping it in the garage losing money!
Personally, after years of experience, I will never again have a garage queen that accrues less than 1000miles a year...life is just too short to be concerned more about the value rather than enjoyment.
In previous cars, I would almost have a meltdown if I ventured out and it rained...now...i couldn't care less and indeed on Thursday specifically took the mac on a 300mile journey even though it was torrential when I set off.
I enjoy driving in the wet especially at night
650spider said:
My friend had a Golf R a few years back on one of the similar 2 year 'hire' deals they offered.
He loved it and did not neglect it as his plan was to try and secure a deal to purchase at the end of the term.
The purchase price they offered him was far greater than the GFV that was drawn up and indeed higher than most were for sale of a similar age / mileage at the dealers.
They also offered to extend his deal by 12months but it was 50% more than what he was currently paying a month.
So away it went.
on He loved it and did not neglect it as his plan was to try and secure a deal to purchase at the end of the term.
The purchase price they offered him was far greater than the GFV that was drawn up and indeed higher than most were for sale of a similar age / mileage at the dealers.
They also offered to extend his deal by 12months but it was 50% more than what he was currently paying a month.
So away it went.
I thought on a PCP you could buy it t rhe GFV, hand it back or use any equity towards a new car. is this not the case. I have only had one car PCP and the car was below GFV at the end so it went back no questions asked . I did offer the finance company the market price, they said no GFV or nothing
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