Why the PH hatred for PCP?

[Deep Thought]

bad company said:

There’s some truth in that but surely the same applies to:-

mobile phone contracts
Sky tv deals
Renting a house/flat
Fuel deals
Mortgages
Life insurance
Buying a pension

Life in fact. You need to look carefully at what you’re buying.

And buying a used car and or with cash doesn't change that. The bulk of people pay more than they need to for most things.

[Welshbeef]

bad company said:

There’s some truth in that but surely the same applies to:-

mobile phone contracts
Sky tv deals
Renting a house/flat
Fuel deals
Mortgages
Life insurance
Buying a pension

Life in fact. You need to look carefully at what you’re buying.

Finding the right life partner isn’t easy your ting to (his or her) yang. A good knee trembler doesn’t make a great marriage (but let’s be fair most sit in the middle of the curve )

[Deep Thought]

Gordon_Roslin said:

My point is that MOST people sit in the middle of this curve, i.e. paying over the odds compared to getting a 2 or 3 year old used car that they wouldn't even be able to tell wasn't new if they weren't told. they could bank that money and do something with it that isn't having it in an asset that's sat on the drive or in a car park 95% of the time. That's my point.

Well heres how that will pan out in reality....

3 year old Focus versus new one.

• 3 year old Focus, £10,000 ish on average for one with average miles from a reputable dealer with a warranty.
• Cheap loan @ 2.8% APR = repayments of £289 a month, total amount payable £10,432.
• After three years lets be generous and say its worth £4,000 on a trade in.

Total cost = £10,432 - 4000 = £6432. Monthly equivalent = £178 per month.

New Focus.

• First place i looked for a lease deal - initial rental £1295, £219 a month, 3 years @ 10K PA. Total payable - £9250. Monthly equivalent = £256 a month. I'm assuming a PCP deal would be "similar".

So for that £78 extra a month / £18 per week your typical buyer is getting :-

• A 3 year fully comprehensive warranty
• No ad hoc big bills to worry about
• No MOT worries
• Far less maintenance

And some less tangible benefits

• Potentially better fuel economy (newer car)
• Less risky purchase (unknown history, possible previous damage on used car, etc)
• Less time off the road for routine / adhoc maintenance.

So yes, costing them more, but not a ball achingly larger amount more and there are perceived benefits for them. If someone wants to spend that bit extra to get the above, whys that an issue?

AND more interestingly, generates loads of good, used cars down the line for the likes of yourself to buy

Still cant see why people PCPing / leasing new cars makes you so angry?

[Dr Jekyll]

Deep Thought said:

So for that £78 extra a month / £18 per week your typical buyer is getting :-

• A 3 year fully comprehensive warranty
• No ad hoc big bills to worry about
• No MOT worries
• Far less maintenance

And some less tangible benefits

• Potentially better fuel economy (newer car)
• Less risky purchase (unknown history, possible previous damage on used car, etc)
• Less time off the road for routine / adhoc maintenance.

Far less maintenance? Really, compared with a 30-60000 mile car? MOT is a minor inconvenience so you are really paying £78 a month for a longer warranty. Obviously some used cars may have been damaged, but equally some new cars haven't been put together properly, and any fuel consumption difference is likely to be negligible on 10,000 miles a year.
I'm not against PCP or leasing but I do dislike the assumption that any car with a previous owner is automatically likely to need continual fixing.

[Monkeylegend]

Dr Jekyll said:

Deep Thought said:

So for that £78 extra a month / £18 per week your typical buyer is getting :-

• A 3 year fully comprehensive warranty
• No ad hoc big bills to worry about
• No MOT worries
• Far less maintenance

And some less tangible benefits

• Potentially better fuel economy (newer car)
• Less risky purchase (unknown history, possible previous damage on used car, etc)
• Less time off the road for routine / adhoc maintenance.

Far less maintenance? Really, compared with a 30-60000 mile car? MOT is a minor inconvenience so you are really paying £78 a month for a longer warranty. Obviously some used cars may have been damaged, but equally some new cars haven't been put together properly, and any fuel consumption difference is likely to be negligible on 10,000 miles a year.
I'm not against PCP or leasing but I do dislike the assumption that any car with a previous owner is automatically likely to need continual fixing.

You also get the new car smell

Oh and new seats with no nasties lurking deep inside them.

[Gordon_Roslin]

Deep Thought said:

Well heres how that will pan out in reality....

3 year old Focus versus new one.

• 3 year old Focus, £10,000 ish on average for one with average miles from a reputable dealer with a warranty.
• Cheap loan @ 2.8% APR = repayments of £289 a month, total amount payable £10,432.
• After three years lets be generous and say its worth £4,000 on a trade in.

Total cost = £10,432 - 4000 = £6432. Monthly equivalent = £178 per month.

New Focus.

• First place i looked for a lease deal - initial rental £1295, £219 a month, 3 years @ 10K PA. Total payable - £9250. Monthly equivalent = £256 a month. I'm assuming a PCP deal would be "similar".

So for that £78 extra a month / £18 per week your typical buyer is getting :-

• A 3 year fully comprehensive warranty
• No ad hoc big bills to worry about
• No MOT worries
• Far less maintenance

And some less tangible benefits

• Potentially better fuel economy (newer car)
• Less risky purchase (unknown history, possible previous damage on used car, etc)
• Less time off the road for routine / adhoc maintenance.

So yes, costing them more, but not a ball achingly larger amount more and there are perceived benefits for them. If someone wants to spend that bit extra to get the above, whys that an issue?

AND more interestingly, generates loads of good, used cars down the line for the likes of yourself to buy

Still cant see why people PCPing / leasing new cars makes you so angry?

Firstly I'm not angry. Secondly, your mathematics are mistaken. A 3 year old Focus can easily, easily be picked up for £8,000. The £4,000 value after another 3 years stands as fair enough, thus £111 per month. Therefore what you describe as a little extra cash is more than double.

The difference equates to north of £5,000 over 3 years - a not inconsiderable sum. Let's say this person is unlucky and has to spend half of that on repairs and maintenance - it still results in a not inconsiderable sum.

If people want to spend more on a PCP, I couldn't be more pleased with them. It's when people start cherry picking examples, fabricating numbers or outrightly inventing guff to somehow claim that it is also usually the cheapest/best choice that we start to have an issue.

[nickfrog]

Dr Jekyll said:

Far less maintenance? Really, compared with a 30-60000 mile car? MOT is a minor inconvenience so you are really paying £78 a month for a longer warranty. Obviously some used cars may have been damaged, but equally some new cars haven't been put together properly, and any fuel consumption difference is likely to be negligible on 10,000 miles a year.
I'm not against PCP or leasing but I do dislike the assumption that any car with a previous owner is automatically likely to need continual fixing.

The £78 should probably be reduced by £15 worth of opportunity cost at your typical 2% mortgage, perhaps £10 worth of fuel, £5 worth of MOT even if you ignore the time/trips dedicated to it, if you can get a 2 year lease then probably won't need any consumables so perhaps another £10. You're looking at very modest £40 additional cost minus the cost of an extended warranty to compare like for like. The point is there is not much in it, as in pocket money although of course you could keep the car for a few more years and that would make the ownership proposition better. Nothing wrong with running an older car. I'd rather not but each to their own.

[Deep Thought]

Dr Jekyll said:

Far less maintenance? Really, compared with a 30-60000 mile car? MOT is a minor inconvenience so you are really paying £78 a month for a longer warranty. Obviously some used cars may have been damaged, but equally some new cars haven't been put together properly, and any fuel consumption difference is likely to be negligible on 10,000 miles a year.
I'm not against PCP or leasing but I do dislike the assumption that any car with a previous owner is automatically likely to need continual fixing.

Well ok maybe "far" is a stretch, but on a typical new car running it 3 years you might only need a couple of front tyres.

Typically running years 4-6 you'll need at least another set of fronts maybe 2, at least one set of rears 3 MOTs, maybe brake pads, stuff like that. Plus the risk of an adhoc bill (not unusual if its a diesel). So maybe 6-8 extra touchpoints with a garage. Not saying it would put me off running a used car, but its a consideration for a lot of people.

[Deep Thought]

Gordon_Roslin said:

Firstly I'm not angry. Secondly, your mathematics are mistaken. A 3 year old Focus can easily, easily be picked up for £8,000. The £4,000 value after another 3 years stands as fair enough, thus £111 per month. Therefore what you describe as a little extra cash is more than double.

The difference equates to north of £5,000 over 3 years - a not inconsiderable sum. Let's say this person is unlucky and has to spend half of that on repairs and maintenance - it still results in a not inconsiderable sum.

I was looking at cars with average miles so 35,000 or less and from a reputable dealer. There may be cars cheaper than £10K but that seemed to be a fairly typical price that someone might pay for a 2016 car with 30,000 odd miles and a decent spec.

Lets say theres a £3,000 saving overall - allowing for a £9K car and maybe spending more on maintenance. Thats still only £83 a month, so £20 a week. Hardly a deal breaker for most people surely?

Gordon_Roslin said:

If people want to spend more on a PCP, I couldn't be more pleased with them. It's when people start cherry picking examples, fabricating numbers or outrightly inventing guff to somehow claim that it is also usually the cheapest/best choice that we start to have an issue.

It can on occasions. Depends on the car, depends on the deal. Happens more frequently with leasing but does happen with PCP. I dont think PCP deals are as palatable as they used to be mind you, but it does happen.

With the lease deals, its not cherry picking. The deals are there. Even hotukdeals are picking up on it...

https://www.hotukdeals.com/tag/car-lease

[roadsmash]

Gordon_Roslin said:

Firstly I'm not angry. Secondly, your mathematics are mistaken. A 3 year old Focus can easily, easily be picked up for £8,000. The £4,000 value after another 3 years stands as fair enough, thus £111 per month. Therefore what you describe as a little extra cash is more than double.

The difference equates to north of £5,000 over 3 years - a not inconsiderable sum. Let's say this person is unlucky and has to spend half of that on repairs and maintenance - it still results in a not inconsiderable sum.

What exactly is your point?

New cars are more expensive?

Yeah we know that Gordon. But it’s not the point of this thread.

[Deep Thought]

roadsmash said:

Gordon_Roslin said:

Firstly I'm not angry. Secondly, your mathematics are mistaken. A 3 year old Focus can easily, easily be picked up for £8,000. The £4,000 value after another 3 years stands as fair enough, thus £111 per month. Therefore what you describe as a little extra cash is more than double.

The difference equates to north of £5,000 over 3 years - a not inconsiderable sum. Let's say this person is unlucky and has to spend half of that on repairs and maintenance - it still results in a not inconsiderable sum.

What exactly is your point?

New cars are more expensive?

Yeah we know that Gordon. But it’s not the point of this thread.

+1

Pay a bit more, run a new car, pay a bit less, run a used car. Simples. Neither is "wrong".

If people want to PCP a new car, who cares? If they've half a brain at all they'll get a reasonable deal at worst. If they shop around / put a bit of effort in to it they could get a decent deal. But again, who cares either way?

The new car market feeds the used car market. Without palatable methods to finance new cars the used car market would be stuffed.

Edited by Deep Thought on Wednesday 6th February 12:49

[Car-Matt]

Are we still getting idiots complaining they dont like PCP because:

1) They dont understand depreciation
2) They dont buy new cars because they depreciate
3) They dont ever buy new cars because used ones are cheaper



Its the same retarded comments over and over. PCP works for a lot of people, end of. Particularly as a second low mileage car, ie the wifes car, weekend car for commuters with another method of transport in the week, ie train

Edited by Car-Matt on Wednesday 6th February 14:06

[bad company]

Car-Matt said:

Are we still getting idiots complaining they dont like PCP because:

1) They dont understand depreciation
2) They dont buy new cars because they depreciate
3) They dont every buy new cars because used ones are cheaper

In a word. Yes.