How do people get brand new cars every year? How does it work?

Bpmull · 13-04-2015 10:08PM

mickdw wrote: »

To get back to the op, there is no known way for your average man with average income to drive a new 7 series each year

Well if he lived / slept in said 7 series instead of a house then it would be possible :pac:

No infairness you are right assuming no external funding lad earning 35-40k euro a year + new 7 series every year just don't add up at all.

mickdw · 13-04-2015 10:15PM

Bpmull wrote: »

Well if he lived / slept in said 7 series instead of a house then it would be possible :pac:

No infairness you are right assuming no external funding lad earning 35-40k euro a year + new 7 series every year just don't add up at all.

Even living in it, I don't think it's possible. The depreciation on a 100k 7 series would be over 20k in first year.
Maybe renting out the boot as a studio apartment might make up any shortfall

somefeen · 13-04-2015 10:18PM

arleitiss wrote: »

I assume "company car" means company like car dealer or company that requires person to travel a lot? Or can it be office workers too?

Sometimes its offered as a perk even when the person doesn't need to travel for work.
Falling away now because you can be taxed as 'benefit in kind'. So they basically tax you on what the car is worth.

impr0v · 13-04-2015 10:22PM

mickdw wrote: »

To get back to the op, there is no known way for your average man with average income to drive a new 7 series each year

Become a chauffeur?

mickdw · 13-04-2015 10:25PM

impr0v wrote: »

Become a chauffeur?

True enough, would still eat up most of the profits but it might be a runner alright if guaranteed the right type of work.

MuppetCheck · 13-04-2015 10:29PM

mickdw wrote: »

I think bobs real name is pat Kenny and he gets his car free in exchange for turning up to a few launches and being a brand ambassador.

I've now been permanently turned off BMWs.

Greyian · 13-04-2015 10:45PM

mhackett102 wrote: »

Two cars. Practically the exact same. One is 2015 and another is 2014. €1,405 of a difference in a selling price.

*Note: This was just based on a quick search done on carzone, I couldnt come across any garage which had two similar cars with only a year difference.

The price you pay for the 2014 model isn't really relevant though, it's what you'd get off the dealer for it (the €15,995 includes his margin).

The 2014 model would have been bought last year at €17,400, but probably only got €14,000 trade in value (if you were moving to a 2015 model), so the person would have been looking at paying ~€3,400, so basically depreciation of 19.5% (let's say 20%).

50% isn't right (except maybe for €100,000+ cars, where the people who buy them wouldn't want to disgrace themselves by ever driving something someone else already has, ugh), but I'd imagine it's around 20% depreciation per year.

blackbox · 13-04-2015 10:51PM

*Kol* wrote: »

Bob has tons of wedge and/or a really good company car deal if he is getting a 7 series every year. Benefit in kind on that makes my eyes water.

BIK depends on value of car. It makes no difference how long you keep it. i.e. there is no additional BIK if you get a new car every year compared to keeping the car for several years unless it is a dearer car.

Back to main topic, I'd guess Bob has an alternative source of funds.

mhackett102 · 13-04-2015 11:09PM

TallGlass wrote: »

Sorry. No way would you get a 2012 Fiesta for 2500. More like 8/9k.

Exactly what my example was trying to prove

Voodoomelon · 13-04-2015 11:26PM

In fairness, the majority of neighbours, friends of friends etc that are changing their car every year are driving run of the mill, humdrum models, usually in the €15-€25k bracket.

Changing every year probably costs most of them €3000-€5000 a year to do so. Such is the cost of having no NCT, no tyres or servicing and having a brand new fresh, reliable car on your drive.

Whilst there are some people out there doing the same with Audi A6s and 5 Series and other €45-€60k cars, there are a lot fewer of them. And to see it with a flagship is even more unusual. Anyone that i've known over the years with new S-classes, 7 series or A8s keep them for several years and would be a lot less likely to swap every 12 months.

bazz26 · 13-04-2015 11:29PM

Maybe Bob doesn't actually own the car. If he is driving a car like a new 7 Series then maybe his job is at such a level within the company he works for where such a new car every year is a benefit of his job.

Of course Bob could just simply be wealthy too.

BMJD · 14-04-2015 01:34AM

Bob sells heroin to children outside school on his lunch break.

kikidelvin · 14-04-2015 01:49AM

access to lots of tax free dosh...............:)

afatbollix · 14-04-2015 08:54AM

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

Lombardo86 · 14-04-2015 09:11AM

afatbollix wrote: »

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

Very interesting actually when you see a real life example. Given you have tax, NCT and servicing already, I have allocated rough figures of:

150 per month * 24 for petrol =3600

insurance of1400 (roughly 700 a year for average Joe)

Your actual payments total6600

If car value is 40k, you have spent 11600 over the two years and the value has depreciated to 22.5k. It seems like in that case you're onto a winner

C0N0R · 14-04-2015 09:29AM

afatbollix wrote: »

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

No deposit required?

ironclaw · 14-04-2015 09:53AM

I'd make the opposite argument, and its just a point of view, that I'd rather have an asset in my front driveway than something I don't own. If, in the morning, I'd needed a lump of cash. I can cash out the car, even at a fire sale price and have access to the funds. I can't if I don't own the car. Also, if the job is gone tomorrow and I can't make the repayments, its irrelevant for the car outside and my credit isn't affected.

Some things are better on credit, like a house mortgage, but I feel Ireland is slipping the way of America / Celtic Tiger by upping our personal credit liabilities. The reality is very few people here can afford the higher end models, leased or owned, but we have an obsession here to 'having to have one' to keep up with the neighbours etc.

I do of course acknowledge the benefits of having zero liabilities in terms of NCT, service etc. That is attractive.

BMJD · 14-04-2015 10:03AM

ironclaw wrote: »

I'd make the opposite argument, and its just a point of view, that I'd rather have an asset in my front driveway than something I don't own. If, in the morning, I'd needed a lump of cash. I can cash out the car, even at a fire sale price and have access to the funds. I can't if I don't own the car. Also, if the job is gone tomorrow and I can't make the repayments, its irrelevant for the car outside and my credit isn't affected.

Some things are better on credit, like a house mortgage, but I feel Ireland is slipping the way of America / Celtic Tiger by upping our personal credit liabilities. The reality is very few people here can afford the higher end models, leased or owned, but we have an obsession here to 'having to have one' to keep up with the neighbours etc.

I do of course acknowledge the benefits of having zero liabilities in terms of NCT, service etc. That is attractive.

that scenario is entirely dependent on how you paid for the car in the first place though; if it's bangernomics then that's grand but if you spent a large chunk of savings on it then it isn't as clear cut

afatbollix · 14-04-2015 10:31AM

C0N0R wrote: »

No deposit required?

€2k So still quids in.

I'm happy and that's the main thing.

Toyotafanboi · 14-04-2015 10:39AM

afatbollix wrote: »

€2k So still quids in.

I'm happy and that's the main thing.

that's a slight omission :P

still, your car is worth €40k new, you picked it up brand new for €2k up front and you have €6600 to pay back over two years, €8600 all in.

your car is worth an estimated €23k after 2 years, but €40k - €8.6k = €31.4k.

either your estimated future value of your car is very wrong or this company are making huge losses assuming they sell after 2 years.

jca · 14-04-2015 12:08PM

Toyotafanboi wrote: »

that's a slight omission :P

still, your car is worth €40k new, you picked it up brand new for €2k up front and you have €6600 to pay back over two years, €8600 all in.

your car is worth an estimated €23k after 2 years, but €40k - €8.6k = €31.4k.

either your estimated future value of your car is very wrong or this company are making huge losses assuming they sell after 2 years.

It doesn't make sense to me either. No dealer loses money.... Strange that Nct is included when the car won't need an Nct until it's 4 years old.

boardzz · 14-04-2015 01:57PM

arleitiss wrote: »

I thought cars lose value by 50% every year?
So:
Year 0: 120k
Year 1: 60k
Year 2: 30k
Year 3: 15k
Year 4: 7.5k

I've seen someone saying that here on boards

I wanna buy your car when you're trading up

MarkAnthony · 14-04-2015 02:07PM

I suspect there's a tax write off going on somewhere.

I've always wondered if there was some sweet spot of getting a car at X and selling it at Y every few years. Say a two year old car selling it after two years with a year or so left on the warranty and being quids in?

_Brian · 16-04-2015 09:58AM

afatbollix wrote: »

€2k So still quids in.

I'm happy and that's the main thing.

I'm very interested in the leasing option you've quoted.. Can you send me on some details on the company you've used... via PM is fine if you'd rather not post publically.. Cheers.

gonko · 17-04-2015 07:00PM

afatbollix wrote: »

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

If you buy a car and worry about the resale value, then yes, buying a new one will lead to many sleepless nights.
Lets say 275pm over 60 months = 16,500 spent on something you do not own or have title to. Money flushed away.

Now lets say we take advantage of the number plate whores. Pick up the car after 2 years at a huge discount of c.18,000. This is now yours. Lets see if we value the use of the car. Value in use, or cost in use was 3600 pa.
Put a provision of lets say 350pa for servicing etc (services are typically 130 MAX....any more and you are being had).

3950pa total cost. Over 5 years 19750 approx.
Potential resale value...lets assume a 15 year useful life cycle. By the time you sell, lets imagine 7 are used, from a valuation viewpoint.
Lets say you sell on for around 8k.

Cost to Lease over 5 yrs 16500.

Cost to own
Car 22000
Service 1750
TAX 2000 (assume c.400 pa)
Less resale (8000)
TOTAL cost 17,750. ---- If you keep the car longer than 5 years, you will go into a positive cash position. But the point is, it is your car, you do not have to hand it back....ever. Of course, if you choose not to lease new cars, and buy a 3 or 4 year old car (which are mostly still perfect), then you benefit even more.

A depreciating item can work either way
1. You pay an expense each month etc via a lease to justify your cash position,
or
2. See it as a one off expense, that you intend on keeping.

Each choice will be different for different people.

mickdw · 17-04-2015 08:10PM

afatbollix wrote: »

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

With the greatest of respect, those figures are horse**** unless I have misunderstood you.
Did you get the car new or at 2 years old?

a postere · 17-04-2015 10:00PM

What would it cost to change a fiesta / polo sized motor every year if you were doing approx. 10k a year in miles ?

And what would this cost in comparison to changing the car every 3 years or 5 years instead ?

Good job people buy new cars, or there would be no used cars for the rest of us.

. . . and just for fun what would it cost to change to a new fiesta/polo every 6 months from a 1X1 plate to a 1X2 plate. Probably not as much as you think, as dealers could practically sell them off a demos.

Tigger · 17-04-2015 11:54PM

afatbollix wrote: »

I went down the lease route this year.

It is worth € 39,552.42 new. I pay €275 a month, This includes tax, Servicing and NCT after the two years.

After two years I hand it back and go find another one. I don't have to worry about selling or find a good trade in price.

Currently after two years on auto trader my car is worth €22,500

There is no point in owning something that deprecates. It is worth feck all at the end!

seems wrong asthmatically

ardmacha · 18-04-2015 01:37AM

Tigger wrote: »

seems wrong asthmatically

Cough!

R.O.R · 18-04-2015 07:31AM

mickdw wrote: »

With the greatest of respect, those figures are horse**** unless I have misunderstood you.
Did you get the car new or at 2 years old?

I do this for a living and they look like utter bollocks to me. Will try to run actual figures to see how far out they are.

Mention of auto trader makes me think he's not in Ireland, so it's as relevant as saying it costs 12 dong a month to lease the 2 camels I have.

How do people get brand new cars every year? How does it work?

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