Why aren't we all riding Fireblades?
Discussion
PTF said:
Yeah it's a balancing act. You either up the deposit or the balloon. Whatever works to disguise the overall cost, but the monthlies are what people are going to feel going out every month so keep them as low as poss
But ideally you want the customer to keep coming back, so "tricking" them with low monthlies will bite you in the ass at the end when they're burned through their equity
That’s a lot clearer than my drivel. Ta But ideally you want the customer to keep coming back, so "tricking" them with low monthlies will bite you in the ass at the end when they're burned through their equity
Camelot1971 said:
Are there stats to see what the average length of bike ownership is? I would expect most people change theirs every 3 or 4 years if they like a new and shiny one.
If you just want a s
tter to get to and from work then these deals wont make a lot of sense anyway.
Depends what you want. In some ways that's where PCP wins. You pay a minimal amount per month for a newer, more reliable bike with warranty. You pile miles and usage onto it, not really caring too much about it, then in 3-4 yrs you hand it back and get another one. That's when it becomes a bit more similar to leasing where you accept that it's just a means to having another new vehicle every few years but you're not owning it (except with PCP you have that option).If you just want a s
tter to get to and from work then these deals wont make a lot of sense anyway.I've often thought about doing that myself. Get an NC750X on PCP. Stick 20k pa on it and use it all year round. Then hand it back and get another. Though i suspect the mileage charges would kill this idea, and not sure what the impact of wear-n-tear is on PCP, or whether the settlement figure is fixed regardless of condition
rapide said:
Trick wasn’t the right word I agree. It’s a good deal I get that - and yours to sell to whoever at the best price you can if you buy.
My comment was purely aimed at the lowest possible monthly to get the customers in - in a competitive market it must be tempting for dealer X to play with the settlement figures just a bit and therefore leave a little less equity in the deal that dealer Y to get a low monthly to shout loud about? It’s not making the deal any worse in terms of overall cost. However, paying a little more a month and getting more equity at the end is probably better for most?
I am sceptical but not anti dealers, just trying to get my head round it
The dealers carry a big risk there then and if anything the customer is even better off, as the chances of getting the final lump sum exactly the same as the true value are very slim. If the dealer is pushing that further and further then they could end up with a bike worth £8000, but owing £10,000 and the customer can just walk away from it. Those customers would be better off than the one paying cash / loan as the latter have spent an extra £2000 to get to the point the PCP guy can walk away from. My comment was purely aimed at the lowest possible monthly to get the customers in - in a competitive market it must be tempting for dealer X to play with the settlement figures just a bit and therefore leave a little less equity in the deal that dealer Y to get a low monthly to shout loud about? It’s not making the deal any worse in terms of overall cost. However, paying a little more a month and getting more equity at the end is probably better for most?
I am sceptical but not anti dealers, just trying to get my head round it
The key to all of this is really that if you’re doing PCP, then you should put some more money away each month to cover the deposit on your next vehicle. That’s where the car PCP piece is going to fall over IMO, as people are putting their savings into their first PCP paying monthly and then when it ends they’ve got limited equity and no more savings to top their deposit up on the next car. It’s OK for the first few cars as they just increase their monthly payments, but eventually the monthlies / low deposits will bite.
^^^ the dealers can’t raise the GFV unless stipulating a lower annual mileage. They can only lower it, as raising the GFV puts the finance company at greater risk for the reasons you’ve pointed out above. The only variables the dealer can play with are deposit, price, term and mileage per annum.
PTF said:
I went back to Grantham Honda (the supplying dealer) looking to swap bikes, looking at a VFR1200 CrossTourer, but their p/x offer on the fireblade was hilarious. They offered £7k at about 14 months in. To make it worse the salesman was smiling at me in a really smug way, which really pissed me off. I pointed out they were retailing at £9k+ with that condition/mileage, and he just shrugged his shoulders. I was expecting £8k ish and some good will as they had been my "go to" dealer for a while. I was so angry i haven't stepped foot into that dealership since.
A lot of the dealers seem pretty wrapped up in registering new bikes which is understandable, its business, but they seem to have a take it or leave it attitude to when it comes to part exchange of anything they have previously supplied. My local dealer asked a couple of months ago about the possibility of me chopping in my not quite 2 year old mint, low mileage S1000R Sport for another new one but the part ex price offered was daft. The deal was a million miles from being in any way tempting. rapide said:
I like the look of these deals. In your experience how often is there equity left above the settlement figure at the end? Surely they set it at what they think it’ll be worth?
As a general sceptic of finance I fear being told at the end, what do you know - no equity left, deposit top up required, each time you go back to the teet for more?
I can’t give a definitive answer, as apart from there being too many variables such as mileage, condition, etc etc I also work with cars so it might not be quite so relevant. Nevertheless, the manufacturer I work with set the end payment around about 85% of what true value will be. They don’t always get it right, sometimes they are a little optimistic and vice versa. The problems arise when a customer sticks £3000 deposit in (usually p/ex) to get a payment of £80 a month, expecting to renew at the end of contract and carry on paying £80 a month using the equity that’s in the car. This is obviously an issue if there’s only £1000 equity and the customer hasn’t got the other £2000 to top it up! As a general sceptic of finance I fear being told at the end, what do you know - no equity left, deposit top up required, each time you go back to the teet for more?
shielsy said:
How much does the deposit need to be before its taken into account by people?If it was £4k? £5k?
I get the deal is good (I bought 2 bikes from Lings last month) but this "it costs X a month only" attitude is mad - and probably why my street is full of XC90's and Evoques!!!!
Tiggsy said:
How much does the deposit need to be before its taken into account by people?
If it was £4k? £5k?
I get the deal is good (I bought 2 bikes from Lings last month) but this "it costs X a month only" attitude is mad - and probably why my street is full of XC90's and Evoques!!!!
Indeed, its like the deposit isnt real money ..... that Fireblade comes in at £165 per month with the deposit ... in fact broken down over the 36 months the deposit is more than the payments per month at £86 a month eq.If it was £4k? £5k?
I get the deal is good (I bought 2 bikes from Lings last month) but this "it costs X a month only" attitude is mad - and probably why my street is full of XC90's and Evoques!!!!
Tiggsy said:
Might set up my own dealership - I pay YOU £100pm to ride the bike. Amazing deal!!!!! A bike and cash in your pocket every month!!!!
£18,000 deposit please
If you can make it the final payment rather than the deposit I think you might get some take up, otherwise I'm not sure …. £18,000 deposit please
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