New Car - buying brand new from manufacturer

Frugal_bear

Has anyone done a cost estimate to work out how much more it would cost to buy brand new over a period of 3 years VS buying a nearly new car (i.e. less than 10000 miles/1yr old)? Both purchases via dealer finance on a personal contract hire basis and for a luxury model (Mercedes/BMW/Audi).

The three German manufacturers offer quite significant dealer contributions (sometimes negotiated on on individual basis) which makes a brand new purchase quite attractive from a financial view point. The dealer contribution essentially negates the interest on the finance loan so the only loss appears to be depreciation over the term. There would be no such dealer contribution on a Nearly New (as far as I know).

Both New and Used will suffer depreciation, new probably more than the used (depending on model), but then you're getting a new car, ordered to your exact specification so the price may be justifiable.

The difference in cost would therefore be the difference between purchase price and 3/4 year old value projection.

Am I missing something?

I'm usually a cash buyer for used vehicles (less than 3 years old) and am trying to convince myself that brand new is the way to go for my next purchase! Although it's easily affordable, the thought of the depreciation (and any other costs) is putting me off.

If anyone's taken a detailed look at the pros/cons and produced some sort of detailed cost analysis, it would be interesting and useful to know what the overall extra cost is of buying new.

Thanks alot!!

motorguy

I cant see the sense in putting £30,000+ of your own hard earned into a BMW or similar when there are such cracking PCP / lease deals available.

Personally, any time we have been looking at new or nearly new BMW's, because of the "manufacturer finance contributions" and complimentary upgrades, etc, etc you can get on a new car, its rarely cheaper to PCP a used one.

This happened when my wife got her new z4 back in 2012 versus a demo car, against her previous 3.0Si z4, and against my 535d M Sport and subsequent X5 at the time.

Of interest though when i was looking for a golf diesel mile muncher last year it was significantly cheaper to get a 9 month old one on PCP than a new one.

Does tend to work best with the german premium brands.

vansboy

Before my circumstances changed a year or so ago, I was in the market to treat myself to an Audi A5 cabrio.

There was an ok selection of pre reg/demonstrators/company cars around 6 months old, for £32k ish.

At same time there was a finance incentive on new, of £6k, which bought the car down to around £34k ish.

So if you were to finance, then their funding made more sense than the used option. Gets you a zero miles car, first name in log book, full 3 years warranty and a registration letter newer,

When I get my life back, I'll maybe in a position to take up the new offer, on the next generation A5.

VB

Mobeer

Just had a look at an example:

BMW 730D
£67,515 list
£47,279 new (broker)
£44,495 ex-demo 3 months old, 3000 miles (pre-haggle)

This is by no-means unique - new car is more expensive, but the difference is small compared to nearly new, which would make me inclined to buy new. Or look for something a couple of years older.

motorguy

Mobeer wrote: »

Just had a look at an example:

BMW 730D
£67,515 list
£47,279 new (broker)
£44,495 ex-demo 3 months old, 3000 miles (pre-haggle)

This is by no-means unique - new car is more expensive, but the difference is small compared to nearly new, which would make me inclined to buy new. Or look for something a couple of years older.

Factor in that the new car will have further finance incentives available, and the PCP residual value will likely be higher, and it can - and usually does - end up that the new car costs less on a PCP deal.

Having said all that - as you say if you look for something a bit older on a car like this you can get a real bargain. Our local BMW dealer has a Jan 2013 740LD with 12K miles and ALL the toys for £35,000.