Car Leasing

MrJaxy

I ordered an EV car lease back at end of July through salary sacrifice. Car due for delivery in early Q1 2022.  Car is built and in the UK. I read about chip shortages affecting delivery and build so made an enquiry to the dealer as to whether this had affected my order. Seems it has and some specification features have been taken out in the model I will be receiving. I also noted that a new brochure was released about 6 weeks after I placed the order and it is that spec that has been built not the one I ordered. My contract is via my employer with the lease company and I guess they have the contract with the dealer to purchase the car and lease it to me. I have pointed out that when choosing a particular specification/model, that it is the features offered that is what that decision is based on. Seems to me that it is misrepresented if they can change it after order and not even tell you, or give you the option to back out of the contract. Just curious if anyone had this experience and what options they had? I will most likely accept delivery as need the car/don’t want to wait 6 months to go through it again, but I feel that someone in the process whether dealer or lease company needs to acknowledge this isn’t right and offer something ?

Aylesbury_Duck

Isntit a B2B contract between your employer and the dealer? What does it say about the dealer's obligations and what your employer can expect?  

If it is a B2B contract, you wouldn't have consumer rights , so it comes down to the contract.  Any dispute or request for redress would have to come from your employer.

MrJaxy

I think my contract is ultimately with the lease company. My employer just facilitating it. So I think the argument needs to be between my lease company and the dealer but neither seem to be doing anything or that bothered. Dealer says it’s due to global chip issues, lease company say no record of any change to the spec. 

Manxman_in_exile

Who have you signed the contract(s) with?

Presumably you have some sort of contract/agreement with your employer regarding the salary sacrifice, but who has signed the lease agreement with the lease company for the car?  You or your employer?

I must admit I'm not up to speed on lease cars from work - I never had one - but if the agreement for the car (as opposed to how it is financed) is between you and the lease company, then I would expect you to have some way out of it if the car you agreed to lease is not the one you they say you are going to get.  That's what I would expect, but I don't know for sure.

Another thing is, I'm not sure if you have an added complication because it's a salary sacrifice.  I thought I'd picked up from another thread that once you'd agreed to a salary sacrifice for a specific purpose, that they can be tricky to reverse.  But again, I have to admit I'm not sure.

I'm sure others will be along later who are more knowledgeable than I am...

(Good luck - if I were in your position I'd want some "recognition" from the lease company that I wasn't getting what I'd agreed to and what I was paying for.)

Grumpy_chap

MrJaxy said:

some specification features have been taken out in the model I will be receiving. I also noted that a new brochure was released about 6 weeks after I placed the order and it is that spec that has been built not the one I ordered.
My contract is via my employer with the lease company and I guess they have the contract with the dealer to purchase the car and lease it to me.
when choosing a particular specification/model, that it is the features offered that is what that decision is based on. Seems to me that it is misrepresented if they can change it after order and not even tell you, or give you the option to back out of the contract. 

Car manufacturer's usually have a note in the brochure about changing specifications and continuous product development, which allows them some limited scope to vary the specifics after order.  
What are the changes in this case?
Are they reductions, or do they fall under the "continuous product development" mantra?  Some examples:

• Brochure says "radio cassette player", updated to "radio CD player"
• Brochure says "sunroof", updated to "air conditioning"

Of course, even that type of "continuous product development" won't be seen as an improvement by every customer.

As for the contract, there will be several involved and the OP needs to read exactly what the rules are on the salary sacrifice scheme (first) as that is the agreement between OP & employer, then there is often a "salary sacrifice administrator" involved (can be a third-party company), then the lease company, then the car manufacturer.  All of these relationships will have some contractual agreements in place and the OP may not be a party to all the agreements there are.

It is possible that the salary sacrifice is deemed not to have been made, and hence no contract until the vehicle actually arrives.  That would give the OP the strongest position with regard to withdrawal, but may be a case of "cutting off nose to spite face".

Manxman_in_exile said:

Another thing is, I'm not sure if you have an added complication because it's a salary sacrifice.  I thought I'd picked up from another thread that once you'd agreed to a salary sacrifice for a specific purpose, that they can be tricky to reverse.  But again, I have to admit I'm not sure.

I am not an expert, but the normal rules are that salary sacrifice can be varied in the case of a "life event" (which are defined, such as new child).  There is also usually a permitted change once every year.  These are specific HMRC rules, not down to the employer.

I wonder, in the OP's case, whether the salary sacrifice is considered as started until the car is actually received and deductions commence?  That may well be the case from a tax point of view, but the employer could have some rules overlaid on that about committed once a car is ordered.  Otherwise, the employer would be at the whim of employees choosing a car, the company committing, and then the employee changing their mind leaving the employer high-and-dry.

In fact, from an employer's point of view, it would be reasonable to impose a rule that the salary sacrifice can only be changed at the end of the lease cycle to save the employer from receiving back an excess of used salary sacrifice cars that they cannot offload sensibly.  That would be tighter than the rules from HMRC.

I realise that this reasoning here conflicts with my comment higher up It is possible that the salary sacrifice is deemed not to have been made, and hence no contract until the vehicle actually arrives.  That would give the OP the strongest position with regard to withdrawal, but may be a case of "cutting off nose to spite face".

All that proves is that the OP needs to read the detailed rules of the salary sacrifice agreement and the car lease agreement contract that the OP signed up to.

Keep_pedalling

I doubt whether this has anything to do with chip shortages, a lot of EVs have seen a spec refreash since you placed your order. Are these minor or major changes? Has the price also changed?

MrJaxy

Thank you for the detailed responses. 

I believe my contract is with the lease company - Tusker in this case. That said I find myself dealing with all parties - them, the dealer, my employer and the EV charge point provider with no one party taking much ownership on this spec point and also other things but won’t go into them here.

There are get outs for life events like critical illness, redundancy or if I leave my employment and they seem reasonable on paper.

The spec changes in the grand scheme are minor - std stereo now provided where as it was originally a high end surround sound set up, wireless charging for phones also removed. I suppose the point I have tried to convey to the dealer and lease company is that whilst these might be viewed as small changes, I might not have opted for that specification, if these were not part of it. Feels like it’s misrepresented if it can be changed after order. 

There may well be some small print buried somewhere in the terms. I’ll need to spend some time and look into that. In the meantime I have queried what they normally do when this happens, as I can’t be the first, and asked whether any compensation is offered. 

visidigi

There is patterns of this appearing on pistonheads. The items you are missing are not EV limited options being dropped - its generally common that wireless charging and upgraded stereos are in short supply (a number of brands have dropped the latter from option sheets.

Generally compensation is a few hundred quid and for people who bought moreso than lease.

You may have the right to reject. But then again you don't want to wait. There aren't alternatives to this without you being without a car. At the end of the day the car could be sole 10x over at the moment. So while your rights are to not lose significant spec I suspect they could just tell you they cant provide the car so heres your 'money' back and sell it to someone else.

Car market isn't what it used to be.

Ectophile

MrJaxy said:

I think my contract is ultimately with the lease company. My employer just facilitating it. So I think the argument needs to be between my lease company and the dealer but neither seem to be doing anything or that bothered. Dealer says it’s due to global chip issues, lease company say no record of any change to the spec. 

It's not that simple.  If it's salary sacrifice, then you aren't making any payments on the lease.  Instead, you agree to take a pay cut, and your employer makes the payments for the car.  It ends up being a three-way contract.

MrJaxy

@Ectophile that makes sense. 

MrJaxy

So to close this discussion - thanks for all the advice. Seems @visidigi was right in that the dealer has said take it or leave it presumably because they know that they can sell it if I don’t want it. So I can walk away at no cost to me or accept the car. No compensation available.