Why is leasing not popular here?

xabi

I think leasing a car would work for me, seems popular in the UK, but not so much so here. Are there any companies here doing it at reasonable rates?

Superfoods

xabi wrote: »

I think leasing a car would work for me, seems popular in the UK, but not so much so here. Are there any companies here doing it at reasonable rates?

Forgive my ignornance on the subject but is PCP not leasing more or less?

Heres Johnny

Superfoods wrote: »

Forgive my ignornance on the subject but is PCP not leasing more or less?

It is indeed.

afatbollix

Its not.

I lease a Ford Kuga ST-Line edition in the UK.
Heres why its better for me


I paid 3 months down.

I then pay 23 months at £199

After two years I hand the car back. No need to worry about depreciation or how much they offer me for my next car.

The car costs £30,275 + £750 for paint or £31k

I pay £5174 over the two years, They pay my tax and no MOT due in that time.

Looking at Autotrader some Ford Kuga 1.5 ST Line editions are selling for £13k to £15k for a two year old one. Thats £15k depreciation when I paid only £5k for having the car. The risk stayed with Ford and I don't have that risk at all.

Heres Johnny

Heres Johnny wrote: »

It is indeed.

It’s not really as it as the needless dance of trade in or balloon payment etc and you don’t care about depreciation and many leases would include serving too.

I think proper leasing like the Uk or more so the US is a great idea. The value of the car, overall cost etc is meaningless you pay your monthly fee and you have the car when your period is up you hand it back and if you want get another but if not that’s it walk away.

Mooooo

Any leases I've seen seem to be not far off what repayments would be to buy so they have leases priced too high I think

Terrontress

I have leased three cars in the UK.

My most recent was a BMW 225xe. It had a list price of £34k. I had it delivered brand new.

£250 per month for 18 months, maximum of 12,000 miles. No up front payment. £3k total for a brand new car for 18 months.

After the 18 months were up they came and took it back.

Prior to that, I had a Skoda Yeti DSG, 24 months, 16,000 miles, 3+23, £130 per month.

Prior to that a Citroen C4 Picasso, 12 months, 10,000 miles, no up front , £150 per month. That one was delivered from stock. <50 miles upon delivery but six months registered by the time i got it. It had panoramic roof, massaging seats, 360° cameras, virtual dashboard. Every extra imaginable.

For the BMW, they offered me the chance to buy it. I inquired into the other two and was told I couldn't. Citroen UK told me that the best they could do was tell me the name of the auction company and I could maybe try to see if I could bid on it.

They also offered me to extend the lease on the BMW, but I'm working from home at present so didn't think it worthwhile so I handed it back. Someone came to my house and collected it, I bought a 2010 Focus to see me through until I start driving back to work.


The true cost of a car is the difference between the price it is bought for and the price it is sold for. If Citroen UK have some cars they need to shift, they put them out to lease and calculate the auction return on them. Subtract that from what the car costs them and divide it by 12 and charge me that for driving a brand new car for 12 months.

For those three cars, I didn't go into it looking for a C4, Yeti or 225xe. I just looked at what was cheap when my lease was up.

If you have a specific car in mind then you won't get the real bargains.

There were some great deals I missed out on and haven't seen again like a Passat Alltrack DSG at £132 per month

https://www.hotukdeals.com/deals/lease-deal-5000-miles-132-per-month-24-months-volkswagen-passat-alltrack20tdi-scr-4motion-3156-at-nvs-2409687

It would sicken you what can be had in the UK for small money.

Uncle Pierre

Terrontress wrote: »

I have leased three cars in the UK.

£250 per month for 18 months, maximum of 12,000 miles.

Just curious about the mileage allowed. That's 12,000 miles over 18 months, so just 8,000 miles allowed per year?

Similar with the Yeti, where you say 24 months and 16,000 miles - again just 8,000 per year?

What are the extra charges like if you go over that mileage allowance?

eusap

Leaseplan do personal leasing in Ireland, but the rights are very similar to PCP rates

kanuseeme

Terrontress wrote: »

I have leased three cars in the UK.

My most recent was a BMW 225xe. It had a list price of £34k. I had it delivered brand new.

£250 per month for 18 months, maximum of 12,000 miles. No up front payment. £3k total for a brand new car for 18 months.

After the 18 months were up they came and took it back.

Prior to that, I had a Skoda Yeti DSG, 24 months, 16,000 miles, 3+23, £130 per month.

Prior to that a Citroen C4 Picasso, 12 months, 10,000 miles, no up front , £150 per month. That one was delivered from stock. <50 miles upon delivery but six months registered by the time i got it. It had panoramic roof, massaging seats, 360° cameras, virtual dashboard. Every extra imaginable.

For the BMW, they offered me the chance to buy it. I inquired into the other two and was told I couldn't. Citroen UK told me that the best they could do was tell me the name of the auction company and I could maybe try to see if I could bid on it.

They also offered me to extend the lease on the BMW, but I'm working from home at present so didn't think it worthwhile so I handed it back. Someone came to my house and collected it, I bought a 2010 Focus to see me through until I start driving back to work.


The true cost of a car is the difference between the price it is bought for and the price it is sold for. If Citroen UK have some cars they need to shift, they put them out to lease and calculate the auction return on them. Subtract that from what the car costs them and divide it by 12 and charge me that for driving a brand new car for 12 months.

For those three cars, I didn't go into it looking for a C4, Yeti or 225xe. I just looked at what was cheap when my lease was up.

If you have a specific car in mind then you won't get the real bargains.

There were some great deals I missed out on and haven't seen again like a Passat Alltrack DSG at £132 per month

https://www.hotukdeals.com/deals/lease-deal-5000-miles-132-per-month-24-months-volkswagen-passat-alltrack20tdi-scr-4motion-3156-at-nvs-2409687

My mother just bought a 225xe for £20 000 just under 12 k in miles and 9 months old, it was owned by a lease company,

I cannot see that continuing long

Uncle Pierre

I've only recently changed my car (to a 181 reg), and I intend to keep it for a long time, so I'm only here out of curiosity really.

Have just had a look at Leaseplan all the same, and to lease a similar car with a 25,000 km allowance each year (which is what I drive on average) would cost €880 per month for a four-year lease with maintenance included. Drops to €772 per month without maintenance.

Was fortunate enough to be able to buy my own car outright, as I had good trade-in value and a bit of a lucky windfall recently, but financing it over four years would have been €612 per month.

So, €612 per month for a two and a half year old car with 45,000 km on it, or €772 per month for a new car that you hand back at the end of four years and are left with nothing. Am satisfied that I made the right decision for me anyway

Terrontress

Uncle Pierre wrote: »

Just curious about the mileage allowed. That's 12,000 miles over 18 months, so just 8,000 miles allowed per year?

Similar with the Yeti, where you say 24 months and 16,000 miles - again just 8,000 per year?

What are the extra charges like if you go over that mileage allowance?

When you take a lease, you get it for the number of miles you think you’ll need. More miles will cost more. And then there is a cost per extra mile if you exceed the agreed amount.

Usually punitive but some leases, 2,000 times the cost per extra mile is less then paying for a lease with 2,000 more miles.

For the companies offering the lease, it is all about maximising the value they’ll get at the end.

With the Yeti, I paid extra to upgrade the stereo. The same price that Skoda charge on a new car, but that lasts the life of the car whereas I only got it for two years.

And they’ll charge for every scratch, wheel scuff, missing manual etc at the end.

Terrontress

kanuseeme wrote: »

My mother just bought a 225xe for £20 000 just under 12 k in miles and 9 months old, it was owned by a lease company,

I cannot see that continuing long

Was the company Total Motion?

Mine had a list price of £34k new and after 18 months and 11k miles they offered it to me for £19k. After I had paid £4.5k, it’s quite a drop.

Casati

Does anybody understand why leasing can be so cheap in the UK? It makes no sense that the car could lose 14k in two years yet the lease inc financing cost is only 5k. I can’t work it out anyway

Irish leases seem to be priced on the basis of v high depreciation - Ie the lease company seems to estimate the depreciation and then add financing charges and then you pay VAT on top. Makes zero sense to lease a car here for private consumers

PCP is not leasing, it’s a form of hire purchase

kirving

My understanding is that car manufacturers don't typically make huge money per car, but at some point they do need to shift stock and keep production lines and sales channels running, even if it's at a loss. Better to sell a run out model at a big loss than have it sitting on the forecourt next to the new model where it will never sell.

But they can't sell directly to some end customers, as the majority who bought at RRP would then think they're being ripped off.

Leasing companies however can help solve this problem in the sense that they can quickly take large amounts of stock from a manufacturer and the customer never sees what the car was actually bought for.

They can then lease out the car at a cheap rate per month, but then also have the opportunity to recoup some extra cash from people who drive more than the allocated miles. Plenty of people jump at the cheap rate and get caught by this.

To actually get a cheap lease, as another poster said, you have to look for what's cheap and be flexible as opposed to what might be your first choice. Then stick to the mileage limit.

Plenty of leases too cost just as much as what PCP would otherwise cost, but in certain cases there are great deals to be had.

It took going to one of the biggest car auctions in the UK in March (reg plate change time) for me to really realise how much of a commodity cars really are. The day I was there, something like 1,200 were auctioned. Each car took under 30 seconds I'd say, and the vast majority were leasing companies offloading stock at the end the three year lease.

road_high

Alejandro Fresh Salon wrote: »

It would sicken you what can be had in the UK for small money.

Reading that posters prices would make you sick alright. Even taking VRT into account the price differential does not add up

kanuseeme

Terrontress wrote: »

Was the company Total Motion?

Mine had a list price of £34k new and after 18 months and 11k miles they offered it to me for £19k. After I had paid £4.5k, it’s quite a drop.

Scot lease, if I remember correctly, another thing springs to mind was that there was 2 there, only a 1000 miles in difference.Ours was handed back in December and put up for sale in January for £21500, sold then in march for £20000 9 months old,

23.5 k for a new car, I would not be impressed if I had bought new at 34 k.

Well worth leasing if you can get a car for 3k a year,

MetzgerMeister

The main reason why leasing works in the UK and not here (for private individuals at least) is that there is a MUCH bigger market in the UK.

The most recent population in Ireland is just under 5 million. In the UK it's just under 68 million.

This is also a good reason IMO for the much lower motor tax rates in the UK vs Ireland and why cars are cheaper to buy in the UK (along with the extortionate VRT in Ireland)

My most recent example was on Autotrader. I was looking at a 2020 BMW 440i with fourteen (14) miles on the clock and it was priced at £32k. That's around €36k. If I was to import that here I would need €63k to buy it and VRT it based on the VRT calculator.

Wildly Boaring

afatbollix wrote: »

Its not.

I lease a Ford Kuga ST-Line edition in the UK.
Heres why its better for me


I paid 3 months down.

I then pay 23 months at £199

After two years I hand the car back. No need to worry about depreciation or how much they offer me for my next car.

The car costs £30,275 + £750 for paint or £31k

I pay £5174 over the two years, They pay my tax and no MOT due in that time.

Looking at Autotrader some Ford Kuga 1.5 ST Line editions are selling for £13k to £15k for a two year old one. Thats £15k depreciation when I paid only £5k for having the car. The risk stayed with Ford and I don't have that risk at all.

Well i can see why it's not more popular here.....They'd made a massive loss at that craic

Casati

MetzgerMeister wrote: »

The main reason why leasing works in the UK and not here (for private individuals at least) is that there is a MUCH bigger market in the UK.

The most recent population in Ireland is just under 5 million. In the UK it's just under 68 million.

This is also a good reason IMO for the much lower motor tax rates in the UK vs Ireland and why cars are cheaper to buy in the UK (along with the extortionate VRT in Ireland)

My most recent example was on Autotrader. I was looking at a 2020 BMW 440i with fourteen (14) miles on the clock and it was priced at £32k. That's around €36k. If I was to import that here I would need €63k to buy it and VRT it based on the VRT calculator.

That points to the massive margins some dealers must make here - that 440i is at least 15k cheaper than rrp new and they are making a margin still - can’t imagine Joe Duffy’s selling a pre reg with that kind of percentage discount

R.O.R

MetzgerMeister wrote: »

The main reason why leasing works in the UK and not here (for private individuals at least) is that there is a MUCH bigger market in the UK.

The annual Irish car sales are similar in numbers to that of Greater Manchester each year, to put it in some perspective.

Casati wrote: »

That points to the massive margins some dealers must make here - that 440i is at least 15k cheaper than rrp new and they are making a margin still - can’t imagine Joe Duffy’s selling a pre reg with that kind of percentage discount

You'd be very surprised if you knew just how little margin there really is on a new car to the dealer. There are huge volume bonuses though, which is how you end up with some cars being so cheap. It can be cost effective for a dealer to register whatever they can get their hands on towards the end of whatever period the volume is measured on, just to hit the target. Cars would usually then be advertised at close to retail price for a while, and if they don't shift at that price, heavily discounted to move it off the forecourt.