Excess contract mileage: Anyone successfully negotiated?

Herringbone · 7 October 2017 at 1:10PM

Hi all,

I took out a 4-year personal contract hire in Sept 2013 based on 10k miles per annum (accurate at the time). A few months later I was offered a new job, with a longer commute and MUCH more business mileage (around 30k a year).

I called my finance company (Volvo Car Leasing, one of Lex's trading names) and asked to amend my payments based on the new mileage but they told me this was not possible and refused to consider an increased payment. A very rough estimate of the increase would have been £60 - £80 per month, so £3k - £4k over the term of the contract.

I now have an end of contract bill for just under £10k.

Now, I'm not complaining about the terms of the contract - I signed up to it with my eyes open, and if I end up paying it then fair enough and I'll put it down to experience.

I'm planning at least a phone call to chance my arm though - I was clearly willing to pay more all through the contract and the charge they want from me dwarfs any effect on the value of the car, which I returned in excellent condition.

So I'm just wondering if anyone's had any success negotiating over this kind of thing.

Thanks all!

footyguy · 7 October 2017 at 1:45PM

Herringbone wrote: »

Hi all,

I took out a 4-year personal contract hire in Sept 2013 based on 10k miles per annum (accurate at the time). A few months later I was offered a new job, with a longer commute and MUCH more business mileage (around 30k a year).

I called my finance company (Volvo Car Leasing, one of Lex's trading names) and asked to amend my payments based on the new mileage but they told me this was not possible and refused to consider an increased payment. A very rough estimate of the increase would have been £60 - £80 per month, so £3k - £4k over the term of the contract.

I now have an end of contract bill for just under £10k.

Now, I'm not complaining about the terms of the contract - I signed up to it with my eyes open, and if I end up paying it then fair enough and I'll put it down to experience.

I'm planning at least a phone call to chance my arm though - I was clearly willing to pay more all through the contract and the charge they want from me dwarfs any effect on the value of the car, which I returned in excellent condition.

So I'm just wondering if anyone's had any success negotiating over this kind of thing.

Thanks all!

Hopefully you have already been appropriately recompensed for any additional business mileage by your employer.

If not, you can still claim a tax allowance
https://www.gov.uk/government/publications/rates-and-allowances-travel-mileage-and-fuel-allowances/travel-mileage-and-fuel-rates-and-allowances

Herringbone · 7 October 2017 at 2:00PM

Thanks, footguy

My previous employer worked a simple system which paid out for business miles at the HMRC rates. It worked out much better than their company car scheme which was why I switched to my own car in 2013.

My current employer uses a car allowance plus fuel card, and we pay for our personal fuel use on a mileage basis. After tax the car allowance doesn't even come close to covering the hire payment, let alone servicing and repairs, which is why I'm switching to a company car this time.

But my question was really about whether anyone has had any luck negotiating a reduction in large excess mileage charges? It's worth at least a try and I've always found MSE to be a great way of being forearmed.

bigadaj · 7 October 2017 at 3:29PM

If it's a lease then you can't presumably VT it to avoid the enforcement of excess mileage charges.

There could be an argument that their charges should reflect the actual loss suffered due to you exceeding the mileage within the contract. So it would be worth trying to get comparison figures from autotrader say of cars with the mileage so we're talking about, might indicate that their actual loss is say £6k rather than £10k.

Herringbone · 7 October 2017 at 3:36PM

That's the route I was thinking too, bigadaj - just discussing what they've actually lost and pointing out that I offered years ago to pay a higher rental to cover this.

It's contract hire, not lease (assuming they're different, I'm no expert!), and ended in September, the car's away. I just got the mileage bill yesterday and they're wanting to DD the cash on the 17th.

Lucky_Duck_2 · 7 October 2017 at 4:28PM

Out of interest how much was GFV, it might have been better to buy the car and then sell it on

flashg67 · 7 October 2017 at 5:58PM

Lucky_Duck wrote: »

Out of interest how much was GFV, it might have been better to buy the car and then sell it on

If it was a Volvo contract hire, it will have been a fixed term & payments and just return at the end with no GFV or purchase option.

I'd be making the call, once armed with evidence of your previous efforts and valid estimate of the true loss.

Herringbone · 7 October 2017 at 9:13PM

Yes, what flashg67 said.

OK sounds like my original plan was on the right track. The way I'm looking at it anything at all they can reduce it by will be a good result, and it would certainly maintain my opinion of them.

I have to say I was a bit surprised they point blank refused to adjust the payments back then, any other finance I've had has usually been flexible about paying more in that they'd rather have the security of your monthly payment than aiming to get back a huge one-off extra payment in several years' time.

loskie · 8 October 2017 at 7:06AM

IIRC Volvo's extra miles are costly (14ppm?). Some of you are confusing PCP with PCH re VTing.
Lex do have the facility where you can buy their ex lease cars. If it's a good car and you owe them £10k for miles I would consider buying it.

The inflexibility is likely to it being Lex doing the deals on behalf of Volvo whereas VW group, BMW and Merc use their own finance co's. VW are known to sell extra miles mid term at lower than normal rates. Their rates are already pretty low at 8ppm for extra miles.

Excess contract mileage: Anyone successfully negotiated?

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