How did PCP work out in the end?

FaganJr · 28-11-2019 12:17PM

Lantus wrote: »

All cars depreciate in the same manner irrespective of how its paid for.

However in light of recession talk some big players are currently shorting the market to the tune of billions in the believe a crash is imminent. Possibly not a great time to over extend on anything. Esp a car....

Agreed

ronnie3585 · 29-11-2019 02:11PM

Lantus wrote: »

However in light of recession talk some big players are currently shorting the market to the tune of billions in the believe a crash is imminent.

Who's shorting what, in what market?

beggars_bush · 29-11-2019 03:06PM

NIMAN wrote: »

Funnily enough, it was people borrowing for houses they couldn't afford 15 to 12 years ago that got us into a terrible mess.

it was the banks selling the mortgage credit to people and not doing proper finance checks that got them and people in trouble

same with the car industry selling credit to people now

bazz26 · 29-11-2019 03:23PM

beggars_bush wrote: »

it was the banks selling the mortgage credit to people and not doing proper finance checks that got them and people in trouble

same with the car industry selling credit to people now

People also need to take some accountability for their debt situation too. It's far too easy to just say the bank forced me to borrow it and exonerate yourself from accountability. Borrowing money or having debt is not a bad thing, however reckless borrowing or spending and not knowing how to manager debt is.

ronnie3585 · 29-11-2019 03:35PM

bazz26 wrote: »

People also need to take some accountability for their debt situation too. It's far too easy to just say the bank forced me to borrow it and exonerate yourself from accountability. Borrowing money or having debt is not a bad thing, however reckless borrowing or spending and not knowing how to manager debt is.

Absolutely, it's a two way street.

ShadowHearth · 29-11-2019 09:57PM

bazz26 wrote: »

People also need to take some accountability for their debt situation too. It's far too easy to just say the bank forced me to borrow it and exonerate yourself from accountability. Borrowing money or having debt is not a bad thing, however reckless borrowing or spending and not knowing how to manager debt is.

What?! People have to be responsible for their own financial decisions and Dept?! Madness, get out of here!

Actually another hate pet for me. Zero percent is evil! Can go right up to conspiracy theory threads.
If you check all manufacturers in Ireland, then pretty much the only ones who can do 0% apr are VW group dealers. VW has its own bank, that's why they can give good finance. They make money by selling car already. All other manufacturers use third party banks. So the bank wants to make their own slice of pie too. That's why VW group manufacturers are so competitive.
Ofc, if it's a new model, they will have their cake and eat it. New model in demand, so why not to make a few quid on top of it.
Keep in mind VW group gives second hand car PCP too at very low apr 0-2.9%. so you don't need to go new of you don't want.

Mad_maxx · 30-11-2019 11:40AM

Lantus wrote: »

All cars depreciate in the same manner irrespective of how its paid for.

However in light of recession talk some big players are currently shorting the market to the tune of billions in the believe a crash is imminent. Possibly not a great time to over extend on anything. Esp a car....

Someone is always shorting the market

sk8board · 08-12-2019 09:39PM

We have a 171 golf (1.2tsi highline) which was being serviced at a main dealer on Friday and while there the salesman (we know him well), offered a 1.5tsi r-line for slightly lower repayment (€336 v €345), ZERO up front, and a balloon which is increased slightly to €12k v €10.3k - however the guaranteed min value is also increased €2k.
We needed 4 tyres and pads on the 171, so we simply swapped the keys to a new one and pick it up Jan 2nd. 0% apr. 3 years servicing. Ceramic life shine coating all included.
We’re aware the mk8 is coming, and this deal is to shift the final Mk7’s, however the mk8 pricing looks like it’s going to be more for a similar high spec.

L-M · 08-12-2019 09:40PM

sk8board wrote: »

We have a 171 golf (1.2tsi highline) which was being serviced at a main dealer on Friday and while there the sale man (we know him well), offered a 1.5tsi r-line for lower repayment (€336 v €345), ZERO up front, and a balloon which is increased slightly to €12k v €10.3k - however the guaranteed min value is also €2k more.
We needed 4 tyres and pads on the 171, so we simply swapped the keys to a new on and pick it up Jan 2nd. 0% apr.
We’re aware the mk8 is coming, and this deal is to shift the final Mk7’s, however the mk8 pricing looks like it’s going to be more for a similar high spec

You did the right thing to be honest. Those 1.5s are excellent value and theres not many left

micks_address · 08-12-2019 09:42PM

sk8board wrote: »

We have a 171 golf (1.2tsi highline) which was being serviced at a main dealer on Friday and while there the salesman (we know him well), offered a 1.5tsi r-line for slightly lower repayment (€336 v €345), ZERO up front, and a balloon which is increased slightly to €12k v €10.3k - however the guaranteed min value is also increased €2k.
We needed 4 tyres and pads on the 171, so we simply swapped the keys to a new one and pick it up Jan 2nd. 0% apr. 3 years servicing. Ceramic life shine coating all included.
We’re aware the mk8 is coming, and this deal is to shift the final Mk7’s, however the mk8 pricing looks like it’s going to be more for a similar high spec.

Sounds like great deal

ForestFire · 08-12-2019 10:27PM

sk8board wrote: »

We have a 171 golf (1.2tsi highline) which was being serviced at a main dealer on Friday and while there the salesman (we know him well), offered a 1.5tsi r-line for slightly lower repayment (€336 v €345), ZERO up front, and a balloon which is increased slightly to €12k v €10.3k - however the guaranteed min value is also increased €2k.
We needed 4 tyres and pads on the 171, so we simply swapped the keys to a new one and pick it up Jan 2nd. 0% apr. 3 years servicing. Ceramic life shine coating all included.
We’re aware the mk8 is coming, and this deal is to shift the final Mk7’s, however the mk8 pricing looks like it’s going to be more for a similar high spec.

I few things of note here, and it happened in my trade in also, so nothing really wrong with what you done, just some things I noticed when I changed.

You original gmfv was probably low and this allowed you to gain some equity in the first car (like I did with octavia). As you said the gmfv is gone up by 2k in this car, which again was the same for me.

You say you but zero in, but in reality you but you equity and the value of your last car in. My car had a gmfv of 10.5k too but was offered 15.5k in nearly all dealers and 17.5k in my original dealer, so that's 7k going in on new car and not zero. What was your cars real value? Was you first gmfv very low?

Also increasing the gmfv on the next car allows the garage to reduce monthlys but leaves you with a higher balloon or less equity on the next car. The 2k extra would easily push you monthly payment back above you first cars over 3 years. 55 euro a month more on 0% in fact!

Obviously they need to still ensure they do not offer too high gmfv, but the first being possible low allows this apparent easy roll over to the next. It may be more difficult in 3 years on next car though.

sk8board · 08-12-2019 10:37PM

Completely agree - this is kicking the can down the road, saving an €800 service bill too, albeit moving up to the mk7.5, bigger engine, rline spec and virtual cockpit. We had intended paying off the balloon, so this also keeps €10k cash in our account for another 3 years.

We were given €20k on the trade in and the gmv was €17k.
The new gmv is €19k, but the new car listprice is very well discounted - but we had to pick one of the 1.5’s.
The story goes that VW couldn’t make the 1.0tsi engines quickly enough for all the VAG cars that now have it, so they put 1.5’s in some run out models and sold them at the 1.0tsi price.

Looking online, the current market value of our 171 is €20k private (at most) and perhaps €21.5k at dealers. Only 40k kms.

Edit: this is my partners car and we’ve had the ‘front assist unavailable’ error twice now and the active cruise control radar unit has had to be recalibrated twice by vw, which is €450 out of warranty, so she saw that the mk 7.5 has that radar moved up behind the badge and was sold

L-M · 08-12-2019 10:44PM

To be fair the GMFV is a percentage of the price of the new car.

The 12k GFMV is based off the value of an R line 1.5 TSI which is 3K dearer car than the Highline and also prices of cars have gone up since you bought yours in 2017.

Likewise in 2023 prices will have gone up further, so will GMFVs and so will (hopefully) the trade in of your then 3 year old Golf.

micks_address · 08-12-2019 10:46PM

The only worry I have for 2023 is the electric landscape . My guess is vw will want to keep customers so will give decent equity and 0 percent again to keep people buying.

L-M wrote: »

To be fair the GMFV is a percentage of the price of the new car.

The 12k GFMV is based off the value of an R line 1.5 TSI which is 3K dearer car than the Highline and also prices of cars have gone up since you bought yours in 2017.

Likewise in 2023 prices will have gone up further, so will GMFVs and so will (hopefully) the trade in of your then 3 year old Golf.

L-M · 08-12-2019 10:47PM

micks_address wrote: »

The only worry I have for 2023 is the electric landscape . My guess is vw will want to keep customers so will give decent equity and 0 percent again to keep people buying.

If that’s your only worry you should be happier that there’s a higher “guaranteed” value, no?

micks_address · 08-12-2019 10:49PM

L-M wrote: »

If that’s your only worry you should be happier that there’s a higher “guaranteed” value, no?

Well the gmfv on my Tiguan is 15400. To be able to but again without a 5k deposit I'd need a trade of something like 25k for my Tiguan in 2023..

L-M · 08-12-2019 10:59PM

micks_address wrote: »

Well the gmfv on my Tiguan is 15400. To be able to but again without a 5k deposit I'd need a trade of something like 25k for my Tiguan in 2023..

3 year old Highline Tiguan’s are currently mid to late 20s so you’re not far wrong.

Tiguan and Golf are probably two of the best for equity.

sk8board · 08-12-2019 11:03PM

Also bear in mind our 171 golf was €28k list, we made 35 payments (€12k) and got €20k in trade in value.
Previous car was also a golf, the first that was on pcp, so this will be the 3rd one. Car 1 was 18 months old when we got it, we drove it for 18 months and paid €2.5k to move up to the new 171, and now zero upfront to move into this 201 r-line

Wildly Boaring · 09-12-2019 09:57AM

L-M wrote: »

To be fair the GMFV is a percentage of the price of the new car.

The 12k GFMV is based off the value of an R line 1.5 TSI which is 3K dearer car than the Highline and also prices of cars have gone up since you bought yours in 2017.

Likewise in 2023 prices will have gone up further, so will GMFVs and so will (hopefully) the trade in of your then 3 year old Golf.

My thoughts too. Gone from 1.2 to 1.5 and to an RLine theres a 2k lift in GFMV anyway.

The mk8 is going to be very similar to 7. 7 will hold its value

ShadowHearth · 09-12-2019 11:12AM

sk8board wrote: »

Also bear in mind our 171 golf was €28k list, we made 35 payments (€12k) and got €20k in trade in value.
Previous car was also a golf, the first that was on pcp, so this will be the 3rd one. Car 1 was 18 months old when we got it, we drove it for 18 months and paid €2.5k to move up to the new 171, and now zero upfront to move into this 201 r-line

I personally think you did very well. Taking outgoing model has its own advantages too.
Mk 7.5 is out for a while so a lot of design flaws will be flushed out and you got a very good deal on it too. Mk8 early adapters will be beta testers, and it will take a while for flaws to pile up, before VW will do revision on it.
I have preference to take outgoing models myself for those reasons. New shiny is lovely ofc, but a bit more reliability tested over few years is better value for me.

photosmart · 09-12-2019 03:15PM

McGaggs wrote: »

€411 a month would lease one from leaseplan, and you'd have the 5k equity in your pocket.

I didn't know leaseplan were available to private motorists - are they?

ForestFire · 09-12-2019 03:42PM

Just to be clear in my comments, I'm not saying they have not done well and of course they have a better, higher spec car, just noting that the lower monthly payment does not reflect the whole story.

I went from an octavia Estate 1.2tsi to a leon st 1.5 dsg and also have a lower monthly payment, but I only put the min deposit on the octavia, 3k I think, vs 7k in on new car (equity) , and I now have a higher ballon payment also.

Nothing wrong with any of that, as I have a higher spec car also (at least engine and options) but you just need to considered all parts of pcp plan.

beggars_bush · 09-12-2019 04:04PM

bazz26 wrote: »

People also need to take some accountability for their debt situation too. It's far too easy to just say the bank forced me to borrow it and exonerate yourself from accountability. Borrowing money or having debt is not a bad thing, however reckless borrowing or spending and not knowing how to manager debt is.

completely agree.

it is far too easy to get large sums of money on credit, especially for cars

carsfan2 · 09-12-2019 05:40PM

It seems to me from this thread that it is VAG group cars are the only ones that are reporting positive outcomes to pcp.
Possibly this is because they have their own banking arm that can offer cheap rates and incentives to keep the cars rolling over?
It’s in their interest to keep things moving I suppose to keep the factories busy.

mickdw · 09-12-2019 06:34PM

carsfan2 wrote: »

It seems to me from this thread that it is VAG group cars are the only ones that are reporting positive outcomes to pcp.
Possibly this is because they have their own banking arm that can offer cheap rates and incentives to keep the cars rolling over?
It’s in their interest to keep things moving I suppose to keep the factories busy.

100 percent and has been this way for a few years now.
They have the ability to offer relatively true zero percent finance.
It's a great way of discounting without devaluing the product.
Other brands have done the zero finance or 4k discount.
That immediately tells you the real price is the discounted price thereby hitting used values.
Bmw dealers on the other hand appear to let greed for margin destroy any possibility of a successful Pcp.
10k margin between trade in and retail pricing on stuff around 40k is nuts. Vw dealers on the other hand when all contributions from vw are taken into account offer close to retail figures for trade in.
That is the difference between a Pcp that works well and one that doesn't.

Mickiemcfist · 09-12-2019 07:21PM

I think what also helps VAG cars ln pcp is that they have quite predictable depreciation rates & are almost universally popular. I'm a bmw man myself but jesus the man maths doesn't work when you break it down to monthly payments, it becomes all too clear how much money you're spending if the PCP monthly payment accurately tracks depreciation rates.

carsfan2 · 09-12-2019 08:26PM

Mickiemcfist wrote: »

I think what also helps VAG cars ln pcp is that they have quite predictable depreciation rates & are almost universally popular. I'm a bmw man myself but jesus the man maths doesn't work when you break it down to monthly payments, it becomes all too clear how much money you're spending if the PCP monthly payment accurately tracks depreciation rates.

I agree but do Audi not depreciate at pretty much same level as Bmw’s?
any Audi buyers here on pcp?

Heres Johnny · 09-12-2019 08:31PM

carsfan2 wrote: »

I agree but do Audi not depreciate at pretty much same level as Bmw’s?
any Audi buyers here on pcp?

They certainly do, I've what must be one of the best examples of a 2014 A6 bought in 2018 for 20k with only 36k miles on the clock. Lost 35 grand or so in those 36k miles and 4 years.

But that's higher end stuff, golf's and polo's and anything under 35k from VAG are generally good for holding value.

asteroids over berlin · 09-12-2019 08:37PM

photosmart wrote: »

I didn't know leaseplan were available to private motorists - are they?

Should be, my mate done this with Leaseplan UK, think it is only new offering

L-M · 09-12-2019 09:18PM

I disagree with Vw only having a good PCP because of the bank and the APRs, they just actually have a good product. As in, max deposit being 30 percent, no lowering of mileage allowances and a fixed (low) future value to allow for equity.

For example BMW have been well known to set the GMFV as basically what they car is worth (almost 50 percent and more) after three years. Thus giving the customers very low payments day one but absolutely no equity the second time around.

It’s the likes of BMW that gives PCP a bad name. I’ve been selling it since it’s inception and the only cases I’ve ever heard going sour are people who weren’t explained how it works properly day one, or those who bought BMW.

PCP really is a great product.

How did PCP work out in the end?

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