Is PCP a good idea?

LittleOne

It certainly works for me.

I got a brand new VW Polo with a nice contribution from the dealer. They took my old car in (despite it being on it's very, very last legs before a large sum needed to be spent on it) and cleared the finance on it for me.

I've been burned badly by many second hand cars in the past. I'm now driving a nice new car with 3 years warranty, no road tax to pay, no MOT to worry about, no services to pay for (for 2 years), no insurance to worry about (VW insured me for the first year free) and then after 3 years I can choose whether I continue to keep that car and refinance it, or hand it back and get something new.

Everyone has different needs and what works for some will not work for others. You're always going to lose money on cars. I see it as another outgoing. I'm paying less a month for this new car than I was for my older car that was on HP and also without the added stress of MOTs, tax and services.

Definitely shop around, though. I found some dealers weren't very open with me and certainly weren't interested in my budget.

dannyrst

ERICS_MUM wrote: »

Do you mind me asking what sort of dealer/manufacturer contribution you would 'expect' please ?

I was offered £750 earlier this week, on PCP for an Auris costing £22500. I thought this was very poor but perhaps my expectations are too high ?

Thanks

Depends if you knocked the price down too or not? If you're not happy with the deal, go somewhere else.

neilmcl

ERICS_MUM wrote: »

Do you mind me asking what sort of dealer/manufacturer contribution you would 'expect' please ?

I was offered £750 earlier this week, on PCP for an Auris costing £22500. I thought this was very poor but perhaps my expectations are too high ?

Thanks

On my last car I had about £4K in dealer and manufacturer contributions (on top of the discount I negotiated on the new car I might add)

motorguy

ERICS_MUM wrote: »

Do you mind me asking what sort of dealer/manufacturer contribution you would 'expect' please ?

I was offered £750 earlier this week, on PCP for an Auris costing £22500. I thought this was very poor but perhaps my expectations are too high ?

Thanks

It depends on what deal the manufacturer has on. If its £750, its £750. The manufacturer wont bung in a few extra hundred just for you.

Check what discount you're getting too. From the first check of an online broker, £4,000-£5,000 seems achieveable.

https://broadspeed.com/new_cars/Toyota/Auris/Choose_Number_Of_Doors/Hatchback/

fred246

Would you change all your possessions every 2-3 years? Furniture, TV, washing machine, fridge, boiler etc etc. All these items last 10-15 years at least. Why do you want to change things every 2-3 years? Changing your car every 2-3 years does not make sense. You are always on the most vertical part of the depreciation curve. It might work for certain people in the short term, but in the long run it will cost more. People are free to spend money how they like but I do feel that maybe young people in particular seem to think that these contracts are normal and a good idea.

rs65

fred246 wrote: »

Would you change all your possessions every 2-3 years? Furniture, TV, washing machine, fridge, boiler etc etc. All these items last 10-15 years at least. Why do you want to change things every 2-3 years? Changing your car every 2-3 years does not make sense.

You could get a bill for several thousand for a car out of warranty. You would never get that for a washing machine out of warranty.

rs65

clayton16749 wrote: »

is it actually realistic to expect some level of 'equity' at the end of the deal that can be used as a deposit for the next deal?

I like PCP for the aim of relatively trouble/worry free motoring. I pay as little up front and assume no equity at the end. I just view it is as hiring a car long term.

People do say 'but you never own it'. I don't want to own it.

There are cheaper ways to run a car if overall cost is your aim.

fred246

I do all my own servicing and repairs but in 32 years of driving my highest bill from a garage was £230 for some MOT welding. There seems to be a massive industry driven campaign to make people think:
1)Servicing cars is complicated - it's not - in fact it's never been easier
2)Repairs are ultra-expensive - they shouldn't be - parts are pretty cheap - maybe main dealer labour rates are excessive.
3)Cars are going to break down all the time - they've never been more reliable.
I do worry about the state of cars after 3 years PCP ownership though. Garage servicing standards have always been appalling. Will a driver on PCP be worried if their car is actually serviced or do they just want a stamp in the book? How will they drive a car that they are going to get rid of in a few months?

rs65

fred246 wrote: »

I do all my own servicing and repairs but in 32 years of driving my highest bill from a garage was £230 for some MOT welding. There seems to be a massive industry driven campaign to make people think:
1)Servicing cars is complicated - it's not - in fact it's never been easier
2)Repairs are ultra-expensive - they shouldn't be - parts are pretty cheap - maybe main dealer labour rates are excessive.
3)Cars are going to break down all the time - they've never been more reliable.
I do worry about the state of cars after 3 years PCP ownership though. Garage servicing standards have always been appalling. Will a driver on PCP be worried if their car is actually serviced or do they just want a stamp in the book? How will they drive a car that they are going to get rid of in a few months?

Perfect example of 'each to their own'. I have no interest or skills in servicing a car. I will happily pay some else to do it.

I'll get a car on pcp serviced at the supplying dealer - avoids any risk of penalties when it goes back. First two services in my current car were free - plus I drank their coffee and ate their croissants while I waited.

My style of driving doesn't vary relative to method of payment.

fred246

Car servicing will be just an oil change and a few checks. If they see a new car they won't bother with the checks. Just tick the boxes. Do you check if they've changed the oil? I expect not. So often they won't even bother with that. So you've paid nothing for them to do nothing! You're just happy to get the main dealer stamp. Coffee and croissants nice but then you've paid for it. I was talking to a work colleague recently who was taking his 3 year car in to trade-in with a leaking radiator. He was telling me he thrashes them to death and would never sell his cars to anyone he knew. Just got me thinking about the mentality of someone on PCP or similar contract.