Best way to buy car?

Cornucopia

I'm quietly impressed with CarWow as a company - have you seen the huge number of free car reviews they've got on Youtube?

https://www.youtube.com/channel/UCUhFaUpnq31m6TNX2VKVSVA/videos

DrEskimo

Cornucopia wrote: »

I'm quietly impressed with CarWow as a company - have you seen the huge number of free car reviews they've got on Youtube?

https://www.youtube.com/channel/UCUhFaUpnq31m6TNX2VKVSVA/videos

Yea I am also subscribed to car buyer, where Matt worked before CarWow set up their channel.

I didn't;t directly use CarWow when I ordered my S5, but I took the cheapest quote to my local dealer and they matched, so it certainly helped!

DrEskimo

Cornucopia wrote: »

I like the sound of that Zoe for £12k, though.

Sorry, I missed off a very important point that explains why these Zoe's are relatively cheap to other EV's.

This price at £12k discounted is for a battery leased model. Depending on your mileage, you have to pay between £59 and £110 per month to lease the battery.

You can buy a battery owned Zoe, but that will cost around £3-5k more. So if you do low mileage (it's £59 per month for 4,500miles a year) then it makes sense, as it would take over 5years for you to have paid the £4k extra that the battery owned model demands. In contrast, if you do high mileage and need the unlimited mileage option from the rental at £110 per month, then it makes sense to get a battery owned, as it would only take about 3years for the rental to cost the same amount as a battery owned.

Apologises for missing that crucial bit of information. Wasn't trying to mislead, was just absent minded!!

When you add the battery lease, plus the £5-8 cost for charging, it's probably comparable to something like a Renault Clio 1.2 petrol, which will cost around £60 to refuel a month at that mileage. However the servicing is cheaper, and it won't need to change things like brakes often due to regen. So overall, the Zoe might just edge it. Its when you do higher mileage that the EV starts to make economic sense, which is where you probably want to start looking at battery owned.

For me who does low mileage, I know they are roughly as cost effective as a small petrol, but it comes down to whether you are a fan of EV and like the way they drive/ how silent they are.

Cornucopia

Ah okay, thanks for that. Like a lot of people, I think, I am generally enthusiastic about EVs, but somewhat sceptical on the practicalities. For example, my garage is located away from my flat and has no power. Could I get a charging post installed in the street? No idea, and I don't even know whether it's the Council I would have to persuade or the Management Company (or perhaps both).

I'm thinking about the car after the next one (for EV) - the next will almost certainly be Diesel again. One of the additional benefits of leasing/PCP-ing that car will be that if the Diesel market continues to decline, my interests will be protected.

I'm not going to pay £2700 for that privilege, though, and will on the lookout for sensible rates (or using a Lease with a sensible rate built-in).

DrEskimo

Cornucopia wrote: »

Ah okay, thanks for that. Like a lot of people, I think, I am generally enthusiastic about EVs, but somewhat sceptical on the practicalities. For example, my garage is located away from my flat and has no power. Could I get a charging post installed in the street? No idea, and I don't even know whether it's the Council I would have to persuade or the Management Company (or perhaps both).

I'm thinking about the car after the next one (for EV) - the next will almost certainly be Diesel again. One of the additional benefits of leasing/PCP-ing that car will be that if the Diesel market continues to decline, my interests will be protected.

I'm not going to pay £2700 for that privilege, though, and will on the lookout for sensible rates (or using a Lease with a sensible rate built-in).

Yea I'm the same. I not only think EV is the logical way forward, but like how cheap they are and how the drive. However I too am limited in terms of charging. With a private drive it makes absolute sense, but I live in a terraced house with no off street parking. I think I can make it work with the public charging infrastructure/having a charge point installed at my parents (visit them every Sunday for family roast). Time will tell if I do get one...! I emailed my council about installing more chargers, as apparently they have grants to install them if people request, but heard nothing back....

I wrote a lengthy piece about how I think the benefit of a PCP in terms of GFV can be misleading, as the economics don't really work IMO.

Take the Kadjar. Bought on PCP that would be £1,300 deposit and 36 payments at £249. If the car is worth the £6k GFV, then you trade in, settle the finance and that's the end. You would have paid £10,264. Paying £13,495 cash and trading in for £6,000 would have cost £7,495, so a saving of £2,769, which was the interest we identified already.

Now let's assume diesels suffer catastrophic declines in value due to public opinion. The car is actually now worth half that GFV at just £3k. PCP would be the same £10,264. Car is £3k in negative equity and you chuckle as it's now the dealers problem....however how much would it cost if you bought cash..? £13,495 - £3,000 trade in price = £10,495.

All you have saved is £231....the high interest costs to get the GFV by going PCP has cancelled out any savings in unexpected depreciation (more or less...). That is a very extreme example that I think is highly unlikely...you would just sell privately for like £5k!

Unless you can get much more favourable rates on the PCP, the interest you are charged will likely offset any unexpected increased depreciation.

Cornucopia

I think that's a fair analysis, although we've already talked generally and specifically about PCPs for used vehicles are often unfavourable compared to other options.

I think the point for the Kadjar is somewhat moot, as the Lease terms are so much better than either of the PCPs. (That £6k deposit on the new PCP is outrageous). In the case of the Lease, we are talking about £1307 + 36 * £217 = £9119. From the list price, we can deduce the effective valuation for the end of lease, which is: £13,500k. I could certainly see that if the Diesel market crashes, the vehicle will be worth less than that, and there will likely be a cost to finance when purchasing in other ways, that are already built in to the Lease costs.

The difficult thing from an MSE POV, is that these figures and considerations are for one specific model. Although the broad issues are similar, the figures will differ from model to model, and in some cases the distinction will be much less clear than it is here.

Even with the Kadjar's smaller sibling, the Captur:

- PCP is currently on special promotional terms of £199 down and £199pm for 48 months (0% APR). This is a total cost of £9751.

- An equivalent Lease would be £1119 down and £186pm. This is a total cost of £10047.

Not a huge difference, but in this case the PCP is cheaper, and it may be possible to get some discount in addition to the cheap finance.

DrEskimo

Oh yea...every car will be different, and even the time you are looking to purchase will create massive variation (discounts available, used car market, lease deals on offer, etc.).

It's a constant task for people of the MSE when it comes to car buying!

Personally, from my extensive research and some experience of doing used/PCP, used cars will always be my favoured option. I like to pay for things upfront when I know I can afford them. In the event my circumstances change, such as a reduction in income (illness, job loss, accident) or my outgoings increase (baby, family change, etc.), I like not having to worry about being tied to a costly car payment. The car is paid for and can be used/kept as long as needed. I was so relieved when I got out my first/last PCP, despite being sad to not be able to drive a nice car...! But then I don't even like payments using 0% interest, so...!

For example, I would still look to buy a used Captur in cash (or a personal loan for the smallest amount possible, with the lowest APR and pay it off as quickly as possible) to save on depreciation...!

But that's just me. Would be boring if we were all the same

almillar

I'm looking at a cheap second car to do low miles with and considering a Zoe. Brand new they are like £22k, but CarWow have them discounted to £12k.

I've seen a couple of 1yr old ones for £10k and just waiting for one with the right colour. But there are no shortage of overpriced ones on AT...18m old ones with 10k on the clock priced at £16k and £14k....again...just dealer hoping to make a large profit off an unsuspecting punter....hard to think what else it could be, because they obviously have the trade value of the car, and it's going to be close to £7k!

Zoes are a bit of a minefield second hand, and you can't rely on dealerships to know what they're selling (yes, seriously!).

Zoes have a battery lease attached to them that MUST be paid, it varies depending on the miles you intend to do (you can choose). There's a very rare Zoe 'i' where the battery is owned by the driver - these should command a £6,000 ish premium. Battery lease was irrelevant to me as I was 'buying' it on PCP for 2 years - the PCP had a 15,000 mile limit, the battery lease had a 15,000 mile limit.

When looking, just assume there's a lease to add on.

ikkie

Zaijenn said:

Hi, looking for a bit of advice from someone who knows more than I do about buying a car! My husband and I have just returned to UK after 8 years abroad and want to buy a car. We could afford to buy a car up to £20,000 outright but we are concerned that because cars deprecate so fast, this would not be wise. So we are thinking about some kind of finance plan so that we pay a deposit, and have managble monthly payments, still get a new car, can trade in for a new one at end of three years. We were offered a PCP deal with Ford to put 6K downand pay £200 per month. Is this nuts?

Are we better off buying a nearly new 12k car outright? Or should we go hp?! Any advice gratefully received:eek:

I wouldn't recommend you to go for PCP in a used car. If you considering PCP deals then go for a new car. If you're open to HP then may be used car is a good option for you.