This topic contains 20 replies, has 14 voices, and was last updated by  chiffchaff 1 week, 3 days ago.

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  • #4777

    ricky
    Participant

    My mate has a car brand new on one of those lease thing deals. He mentioned to me that he had to go to the main dealer every time for the service to keep the warranty and if/when he gives the car back.

    I thought that you could take a car to any reputable garage to have the service and as long as the paperwork is officially stamped, then all is good.

    Is this not correct?

  • #4778

    redders
    Participant

    One – just one – of the things that’s always put me off those deals is that for the length of the contract, you’re effectively their driving bitch. Want to drive more than we agreed? It’ll cost. Want to get your car serviced, like we told you you had to? That’s us doing the work or if not, you’ll pay twice. Want to keep the car at the end of the contract? You’ll pay what we tell you. Of course, you could agree to have this shiny new car on another contract…

    OK, I don’t know the answer to your question but the whole shebang has always struck me as buying things on the never-never reinvented for the no patience, must-have-it-now generation.

    • #4782

      chiffchaff
      Participant

      I certainly don’t like PCP, but lease hire is much better. It’s a straight forward agreement. I rent the car for X for x months plus an up front deposit. I don’t own it, I give it back after x months with nothing to pay (unless returned damaged) and nothing owned.

      For me the benefit comes from a few things:

      No long term commitment

      Majority of costs known in advance (damage excluded)

      Brand new car – Safer auto braking, radar, airbags etc, newer tech, more mpg than older vehicles (cough i’m driving a golf R)

      Pay little more than the depreciation if I had bought out-right and sold on

      It’s in Warranty so running costs are servicing (x2 @ £160) fuel (by the bucket load) and tyres (Performance car – not cheap but recon I’ll get away with one set as I’ve only just changed them)

      I can thrash the nuts out of it knowing I won’t have to maintain it in later life

      Bad points:

      I have to be anal about parking to avoid door-denters.

      If you don’t do regular miles and you under estimate you could get a small bill at the end, but you know this well in advance. (My friend is in this position after changing commute length and will be approx 3000 miles over at the end of his lease at £12p a mile that’s still only 360 – roughly a months rental for his BMW)

      On the other hand the deal I’m currently on is for 15K a year and I’ve done 22 in 23 months so far with a year to go so I’ve arranged to drop to 10K for the final year saving me £20 a month (meaning I get 18K miles to play with this year for less money)

      It isn’t the cheapest way to go motoring and should I need to economise I might go back to owning cars (or just lease something much cheaper)

      • #4783

        Crud
        Participant

        I have to be anal about parking to avoid door-denters.

        We looked at 5 ex-PCP leafs, all sub 20k milage.

        I couldn’t believe how knackered all but one were cosmetically – worse alloy and paint damage than my 95k miles 3-series and 120k miles X-Trail, as well as a scratched window and dents etc. How do you even do this to a car with an overhead 360deg camera view?

        It seems a lot of people don’t care what that hand back. I suppose they’ve paid so much over the odds, what difference does a bit more make?

        • #4784

          chiffchaff
          Participant

          @crud Have you seen the way people look after their (and other peoples) cars these days? I would think 80% of cars get at least one wheel curbed in their first year

          If someone’s driving a leaf they are unlikely to be someone who enjoys driving or is into cars.

          People tend to enjoy and be interested in things they are good at….

        • #4786

          Crud
          Participant

          Have you seen the way people look after their (and other peoples) cars these days? I would think 80% of cars get at least one wheel curbed in their first year

          Aye. Incredible that these people pay extra for alloys.

          If someone’s driving a leaf they are unlikely to be someone who enjoys driving or is into cars.

          That’s a bit mean! It may have some of the most horrid feeling steering I’ve ever used (some like it but I find the electric power steering very neutral giving no sense of how much demand you’re putting on it – it’s very “video game” feeling), and it may not be that quick, but when I get to drive it on a weekend (my wifes daily runner), I thoroughly enjoy it. I still enjoy it after the novelty wore off; it’s a very different experience and one that has its rewards. There are things you don’t want to do, for sure…

      • #4791

        scats
        Participant

        Another point is the sensible option of gap insurance to avoid difficult conversations if the car is a write off- but – never take the dealers offer of gap insurance, go to ala or someone like them – My wife got an Evoque a couple of years ago and the cost of land rover gap insurance was about £450 for 3 years, ala offered exactly the same cover for £150. Then we had a closer look at her normal insurance policy for the car and it included gap insurance for 2 years so we only needed extra gap cover for year 3.

        • This reply was modified 1 week, 3 days ago by  scats.
    • #4785

      Crud
      Participant

      OK, I don’t know the answer to your question but the whole shebang has always struck me as buying things on the never-never reinvented for the no patience, must-have-it-now generation.

      I used to think of it like that.

      Now I see it as a way for the no patience, must-have-it-now generation to heavily subsidise dealer warrantied, low mileage used cars for purchase by grumpy old farts like myself.

      The automotive credit firms mug people so much with the initial PCP that they’ll let cars go for a song second hand on interest free HP to keep stock moving down the chain.

      The whole thing feeds the monster depreciation cars see in the UK. Part of me weeps with agony over this wanton waste of resources. Part of me makes happy noises every time I put my foot down in our second hand Nissan Leaf which we got on incredibly good terms…

  • #4779

    Clint
    Participant

    They have their uses – I bought my car on one of them, but I was lucky enough to get a very good deal on it. Paid the finance for the minimum term I had to, then paid off the balance on an interest-free credit card. I now own it outright and will probably do what I usually do – run it until it gets too expensive to maintain and then get a newer one.

    My wife has just opted out of the company car scheme and bought a car on PCP using her car allowance – doing this should actually save us a few thousand compared to the company car. When she last changed from a private car to the company one, she actually made a profit by paying off the bubble and then selling it to another dealer.

    But overall, no, I don’t like the principle and I agree with redders above.

  • #4780

    chiffchaff
    Participant

    No you aren’t correct.

    It’s not because of holding the warranty (you are correct in asserting that a warranty must be honoured as long as the service schedule has been met by ANY reputable garage.

    It’s because the car is leased. It is not owned by your mate, and as part of the agreement with the owner it is to be serviced at the main dealer. This is because lease hire companies sell on their cars into the approved used market and people like to see full dealer service history.

    If you are considering leasing it’s important to check what the service charges are. Most lease hire companies offer a deal to include servicing for £15+ extra a month.

    • #4781

      ricky
      Participant

      That’s another reason for me to never take such an offer.

      Cheers everybody

  • #4787

    dabdab
    Participant

    We are looking at buying a second hand car at the moment. The dealers offer extortionate HP repayments and keep pushing for us to buy new.

    One even tried to sell me gap insurance for £400 on a 5 year old car worth £6k.

    I really don’t think their intention is to sell cars, their intention is to sell finance packages. One salesman called me back and asked if I’d thought about either the HP of the PCP option. I told him exactly what model, age, and mileage of car we were looking for and how much we wanted to spend, told him we had a loan in place with 3% interest, three weeks later and he’s still not called back. This is from a national network of dealers who deal in a very popular make of car, the model and age of which are all over the internet at the price we are willing to pay as they’re all at the end of their PCP contract.

    • #4788

      troll
      Participant

      I really don’t think their intention is to sell cars, their intention is to sell finance packages.

      Too true. I negotiated £2k off a car entirely dependent on me buying £1.5k of service and finance (no discount if you don’t buy the packages). Oh what a surprise that I happened to spot there was a 14 day cooling off period. All cancelled, happy driver, cross salesman.

  • #4789

    Duck
    Participant

    Pros

    You get behind the wheel of a new car for lower monthly repayments than a personal loan or hire purchase.

    You don’t need to worry about the future trade-in or resale value of the car, as the lender guarantees your car will be worth a minimum sum at the end of the deal.

    It’s flexible. You’ve several options at the end of it – you can even buy the car if you like.

    Dealers will often throw in service and maintenance packages, warranties and insurance so you can get your total cost of motoring down to one payment each month (though check these are free, or if not, represent good value).

    A PCP may let you buy a more expensive car than you might otherwise be able to afford but with monthly payments to suit your budget.

    As PCP deals are usually only offered on new or nearly-new cars, you don’t have to worry about an old banger that’s likely to need a lot of repair.

    All from the uber entitled baby boomer, exploit renters generation idol Martin Lewis. I could have just quoted moneysavingexpert but it seems you need to belittle other generations to contribute.

  • #4790

    stew
    Participant

    I spent the first 20 years of my driving career thinking that anyone who drove a brand new car must be mad – that the only way to get value was to buy at about four years old and sell at about eight, so you’re not taking the hit of depreciation.

    Then I was persuaded to look at it more carefully, and realised that the overall cost of running my five-year-old Skoda Yeti was much higher than I thought. When I factored in servicing, maintenance, breakdown, MOTs, VED, tyres, and the decreased fuel costs, I found that it cost me about 70p/day to switch to a brand new hybrid on a three year PCH. Admittedly this was influenced somewhat by the fact that the new car is hybrid and I do my daily commute on battery alone – I’m saving about £4500 on fuel over the thre years.

    The thing that tipped me was the reduced risk of a breakdown; I’m in a freelance job where if I miss work, it never comes back, and I had an episode with the Yeti where a trivial problem with the fuel filter ended up costing me an entire day’s work. So the small cost of the new Outlander means I’m (touch wood) more or less guaranteed a reliable car, and paying 70p a day for a larger, more comfy car that’s massively greener seems a perfectly good move. And the reduction in worry is worth it alone – I hate that feeling of your car failing you at a critical moment.

    No idea what I will do when this deal runs out. I’m hoping there’ll be a full electric Outlander by then! Or that I win the lottery and then I’ll buy a Model X.

    • #4793

      nev
      Participant

      Sometimes you are just unlucky with cars. My four and a half year old Seat Leon, bought at 18 months, has never skipped a beat. It wasn’t much more than half list price and is now fully paid for. Ideally, we will get another few years of reliable motoring out of it. Hybrid / EV is another issue and certainly something we will look at, but hopefully not until 2023 or so, by when I suspect the offer will be quite different.

    • #4794

      Nerdkid
      Participant

      Are you sure that there is a reduced risk of breakdown?

      If properly looked after modern cars will do huge mileages with little deterioration in reliability.

      However , I don’t think I could ever trust a vehicle called the Yeti 😉

      • #4795

        stew
        Participant

        I get what you’re saying, and I was always very careful with maintenance. I had a bad run with that Yeti: a £10,000, four year old car managed to leave me stranded a few times. In the course of the next two years, there was a problem with the turbo dropping it into limp mode (eventually traced back to a software update that had been missed), a sparkplug lead that burned through because it was located too close to a hot manifold (this apparently plagued the 1.2TSi engine at first, and was fixed with a little clip that held the leads away from the hot part), and a mis-fitted oil filter causing a leak that brought her to a halt with the red ‘do not start, have me recovered to a garage’ light on. Somehow the car always knew when I had a really busy day on, and those three faults cost me more than £1200 in lost wages.

        Almost 20,000 miles with the Outlander and it has literally never skipped a beat. Of course, electric motors are inherently a lot more reliable than ICE drivetrains, and I’ve done more than half my milage on the battery; the egine has only seen about 8000 miles and most of those are long motorway cruises that don’t stress the parts anywhere near as much as stop-start.

  • #4796

    Mick
    Participant

    Purchased my wifes car on PCP. It was madness to do otherwise.

    Interest rate was 0.3% per annum = £36 interest on £4k over 3yrs

    I think I paid a total of £100 interest over the period as they charge the future value at a higher rate so the £3k final payment was probably at something like 0.6%.

    I loaded the mileage to as high as I could even though the wife was only doing 4-5k per annum to ensure I had as low a final payment as possible. By the time I was finished I paid £100 interest and £150 doc fee over the manufacturer supported price I paid.

    Made complete sense to me and the car was paid off 24hrs after last payment due. Its now 6yrs old and other than servicing its never needed anything. Has about 30,000mls on the clock now and will do another 6yrs quite easily. Reckon by the time its finished my pence per mile will be pretty good.

  • #4797

    ycbm
    Participant

    I’ve been leasing (aka Personal Contract Hire) for 20 years and a key thing to understand is that the good deals (and there are some) are those when the manufacturer has excess stock of any given model (often when a new version is imminent).

    Rather than dump that excess stock on the retail market and depress prices they get rid by giving them to the lease finance companies at huge discounts to list and those finance companies are then able to rent them out cheaply without pulling the rug too much from under the feet of the franchise dealer networks.

    I currently lease a (list) £19k car for £142/month on a 3+23 basis 2 year contract. So I pay c. £3,700 over 2 years which is probably less than the depreciation would have been on a normal retail purchase and of course avoids the need to find / borrow the cash up front. I don’t know what the finance company paid for it of course but I reckon hardly into 5 figures…

    If you want a specific car / model then leasing isn’t for you – you have to be flexible about what you’ll have.

    • #4798

      chiffchaff
      Participant

      Indeed, but there are also deals about on good/specific cars if you know where to look but the timing of availability has to be right. Very recently Jaguar shipped off a load of Diesel R model XFs for £90 a month on a 6+35 deal which is just bonkers! sold out in a day

      I know my car was a good £100 less than the price a few months later because VW wanted to get them onto the road (& 2nd hand market) when first launched

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