Pcp end of term charges

Nasqueron

neilmcl wrote: »

This is simply not true. As mentioned the GMV is reflection of the real value of the car at the end of the agreement, it is not artificially set to prvide a profit to the dealer, it's the finance co. that owns the car, the dealer has no interest in it.

Fine, it's a technical mistake, big whoop, you got to say "well actually....." after someone already posted that. The point I made is still valid that you can sell the car for more than the GMV in some cases. Doesn't really make financial sense to give a GMV of X and then take the car back, go straight to auction and not get at least that value as they'd make a loss on the car, particularly on 0% finance

neilmcl

Nasqueron wrote: »

Fine, it's a technical mistake, big whoop, you got to say "well actually....." after someone already posted that. The point I made is still valid that you can sell the car for more than the GMV in some cases. Doesn't really make financial sense to give a GMV of X and then take the car back, go straight to auction and not get at least that value as they'd make a loss on the car, particularly on 0% finance

The finance companies make profit on the finance product, not the vehicles themselves.

Mercdriver

neilmcl wrote: »

The finance companies make profit on the finance product, not the vehicles themselves.

What about the 0% ones? I have a feeling that there is some meeting in the middle. A car coming back in pristine condition isn't going to go into auction where it will at the whim of who turns up and what their budget is. A 3 year old car will sit quite nicely on the approved used forecourt at many. My merc was just under 3 years old when I had bought it, and it was on a PCP before that.

neilmcl

Mercdriver wrote: »

What about the 0% ones? I have a feeling that there is some meeting in the middle. A car coming back in pristine condition isn't going to go into auction where it will at the whim of who turns up and what their budget is. A 3 year old car will sit quite nicely on the approved used forecourt at many. My merc was just under 3 years old when I had bought it, and it was on a PCP before that.

Given that most, if not all, 0% deals are offered by manufacturer's own finance then it's more about selling units of new cars rather than making a profit on them when the finance terms are finished.

The cars will still end up at auction but quite often closed auctions available to dealers only. The cars that don't go to auction are the ones that are "traded in" to the dealership for a new PCP deal.

Mercdriver

neilmcl wrote: »

Given that most, if not all, 0% deals are offered by manufacturer's own finance then it's more about selling units of new cars rather than making a profit on them when the finance terms are finished.

The cars will still end up at auction but quite often closed auctions available to dealers only. The cars that don't go to auction are the ones that are "traded in" to the dealership for a new PCP deal.

Like I say, I bought my ex PCP merc as approved used at the main dealer, not at an auction.

neilmcl

Mercdriver wrote: »

Like I say, I bought my ex PCP merc as approved used at the main dealer, not at an auction.

You may not have bought it from auction but that doesn't mean the dealer didn't pick it up from there.

Mercdriver

neilmcl wrote: »

You may not have bought it from auction but that doesn't mean the dealer didn't pick it up from there.

Dealer didn't pick it up from there. The original sale papers were still in the car with the service paperwork. The car was sold new from the same dealer in the same site, and they had sold the previous owner another E class subsequently.

neilmcl

Mercdriver wrote: »

Dealer didn't pick it up from there. The original sale papers were still in the car with the service paperwork. The car was sold new from the same dealer in the same site, and they had sold the previous owner another E class subsequently.

Then that goes to what I said earlier about the cars being swapped in for a new PCP deal.