| Motoring Discussion > Can someone enlighten me? PCP question. | Buying / Selling |
| Thread Author: Slightlyfatdirector | Replies: 14 |
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New Mon 11 Jul 11 13:53
Can someone enlighten me? PCP question. - Slightlyfatdirector
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Dear All, To cut a long story short my wife deserves a new car. We have had a bad year with her health-wise and I want to get her a nice convertible as a reward now we have gone through all the nasty stuff. I have only ever bought new cars for myself as company cars where we do not lease, get credit, etc, we just pay for the things with a one-off bank transfer. When it comes to personal transactions, the cars have always been 2nd hand and funded either with cash, or a small loan. So buying a new car is completely new to me when it comes to looking at finance. We are looking at an Audi A3 cabriolet, probably on a PCP. We have not chosen the full spec with all the options yet, but I am working out a haggling strategy, and would benefit from your help and experience. It would appear with a PCP Audi will contribute £2,000, and in general on their website (again, we have not gone into any personal quotes yet), they show list price figures, less the £2,000 with a customer deposit, monthly payments for a set term and then a final payment in 'x' ammount of years. This is fine and clear. What I want to know is whether I can haggle the price down (Drive the Deal implies an 11% discount), and still get the contribution of £2,000 from Audi in such a PCP deal? Is this normal to do this (I hope so!) I know if I ask a dealer they might imply that this is the discount, so because I have seen deals like this advertised before with other manufacturers I wondered what other peoples experience is. I know no better, so advice is appreciated! If I can get an OK trade-in, plus a circa 10% discount, plus the £2k contribution, then it starts becoming affordable and makes some sense. Comments and experience appreciated, thanks. |
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New Mon 11 Jul 11 14:30
Can someone enlighten me? PCP question. - teabelly
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It's worth a try to see if you can. If not, then I'd look at a pre-reg with the right spec as that will be the next affordable option. If you go in near the end of the month and try a few audi dealers I'd bet one of them would roll over. I've never bought a new car or had a loan so I've no idea what is possible... but if you don't ask you won't get :) |
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New Mon 11 Jul 11 14:35
Can someone enlighten me? PCP question. - Skoda
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Glad your wife's getting better SFD. I sold fridges and hoovers for a couple of months with a now bust retail chain while i was going through uni. They made their money selling credit. They'd put top dollar price tags on the appliances then you were allowed to drop significant sums off the ticket price during haggling if you thought it would get you a sale. The difference was made up (automatically while filling the credit application out) in the interest rate the customer paid. I'd just haggle on what you pay, i.e. "it's affordable for me at £500 less deposit + £35 off that monthly payment" - short circuits any sharp practice like that. |
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New Mon 11 Jul 11 16:32
Can someone enlighten me? PCP question. - Slightlyfatdirector
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Thanks Skoda. An interesting point. And teabelly, good point, but they are few and far between at the moment in the right spec (petrol, Sport trim and a colour my wife would like) and the prices are very high, not offering a massive saving over new where you know who has driven it and how, but you are right, it might be worth looking at. Still has to be funded somehow, and the attraction on the PCP is that aspect. |
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New Mon 11 Jul 11 16:36
Can someone enlighten me? PCP question. - ....
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The dealer will probably try to tell you any PCP/Lease type deal is a fixed price. It's not. The lease is calculated from what you agree to pay. In a similar way to looking at the online brokers then approaching a dealer when considering a cash purchase why not look at the online lease companies for a comparison deal. The lady of Chinese origin mentioned at HJ always seemed to have competitive deals. You could use that to get an idea. Last edited by: gmac on Mon 11 Jul 11 at 16:37
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New Mon 11 Jul 11 17:01
Can someone enlighten me? PCP question. - Iffy
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The chances are the £2,000 is an additional importer/concessionaire contribution, so any PCP should be based on whatever is the usual discounted retail price. DriveTheDeal is as good a guide as any to the discounts available. Agree with gmac about getting a quote from the mad Chinawoman, which in case SFD doesn't know is: www.lingscars.com/ As a CC3 owner, I also endorse the type of car. Convertibles are great fun, and curiously we have a good climate for them, which is not too hot. |
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New Mon 11 Jul 11 16:53
Can someone enlighten me? PCP question. - PeterS
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Manufacturer finance offers are generally in addition to any discount you negotiate on the car in my experience, so push for as big a discount as you can! We bought my partners A3 through drivethedeal - very straight forward and all communication after the on-line order was direct with the Audi dealer. I assume therefore that they'd offer the Auid finance package if you wanted it? Have you checked the lead time for an A3 convertible though - when we (only half seriously it has to be said) lookd at swapping my partners A3 for a convertible last year the lead time quoted was well over 6 months! Peter |
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New Mon 11 Jul 11 22:08
Can someone enlighten me? PCP question. - brettmick
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I bought an A3 Cab with the 2 litre turbo petrol engine in Sport trim in February. It was nearly new (10 months) and almost £7k off list with 7,000 miles up. It was bought on an Audi PCP with free servicing for 3 years. I was about to sign up for a new 1.8T that they had pre-ordered and was due for delivery in 3 weeks time, but someone else beat me to it while I was test driving the demo car. The order time for a factory spec was at least 4 months, some 6 particularly the diesels. Although the diesel was surprisingly good (quiet) I couldn't compute a diesel convertible.... There are not very many A3s around for sale (the 240 in autotrader now is 100 more than when I bought) and almost all are at Audi dealers and there seems very little room on the prices - I suspect late September and this will change. I have used PCPs twice before and put my finance hat on to consider that you are "financing the depreciation" and then you take an option in three years time. The tactic of saying "I have this much deposit and want to pay this much a month" works if you have done your homework beforehand. There are some decent PCP calculators around so to use that with a drive the deal style price is a good model to work on. Get it wrong and they will take your money though... It is a stunning car... Really quick, you sit low down so it feels faster, it is very refined and only gets noisy (hood up) compared to a metal roof over 80. You don't tend to go much over 60 with the roof down as its about cruising not raw speed. The cab involves the driver in a way that the regular A3 doesn't (I had a 1.8T A3 5 door new in 09 for 6 months). Driving with the roof down puts me in a good mood regardless of what else might be happening. It is my commute to work car (the other being a very good Japanese family 4x4) and fits the bill perfectly. Took it to Wales on holiday a few weeks ago and even got two days with the roof down! On the 250 ish mile journey home it showed 45.4 MPG. The comment made elsewhere about us having the perfect climate is right - a few weeks ago sitting at a roundabout at 8AM and it was showing 26C outside I was thinking it was almost too warm when stationery and the sun was beating down. |
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New Mon 11 Jul 11 22:43
Can someone enlighten me? PCP question. - Manatee
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I think the £2000 is to deflect you from negotiating a possibly better discount - the only way to find out is to see what you can get and from different brokers/vendors. There's nothing to stop you negotiating a price and then adding a finance package based on the true 'cash price'. Just bear in mind that PCP can be expensive. Contrary to what the average car sales person or "business manager" might tell you, you are not just "financing the depreciation". Built in at the stated interest rate are charges on the reducing balance you will be paying down AND the unreducing balloon payment. So pay attention to the rate (the stated APR). I doubt you'll get better than about 7% unless it's subsidised from the discount, but don't pay more than 8%. You might just persuade yourself with a bit of man maths that with rampant inflation and low savings rates it's not too bad in real terms! The occasional bargains on PCP are when the manufacturer underwrites high guaranteed final payments as an under the counter discount. When 4x4 values crashed a few years ago and manufacturers couldn't shift them, a pal of mine had a Mercedes ML320 with a big spec for £450 a month for 2 years! Look at the whole package and the total cost, compared with the best discounted cash price you can get - a good guaranteed final payment can offset a higher rate of a lower discount, and vice versa. I do finance stuff for a living, and I don't use it myself - gearing to invest can make sense, gearing to spend makes none to me. I spend money only if I've got it, and that includes "interest free". Last edited by: Manatee on Mon 11 Jul 11 at 22:43
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New Mon 11 Jul 11 23:19
Can someone enlighten me? PCP question. - rtj70
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I got a quote out of curiosity on a Passat CC GT 140 diesel. Can't remember exact figures but it was at least £2000 deposit, £500pm for three years. Insurance, tax (after year one), tyres and maintenance was on top. And after three years it wasn't mine. Hence staying in the company car scheme again. And paying less for a 170PS diesel for three years. Of course I could get a Polo and save money... or a Yeti or many other cheaper cars. |
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New Tue 12 Jul 11 09:27
Can someone enlighten me? PCP question. - Slightlyfatdirector
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Thanks Gmac + Iffy. Exactly what I hoped. Thanks to others too. Interesting comments about leadtime. We are in no rush at all and when asked the sales guy thought a factory build would be 4-5 months. He checked on the computer and it said 7 weeks. But then he said "plus 4 weeks shipping". Odd. 4 weeks from Germany? I regularly drive there and can do it in a day. How slow are their trucks! :) Are they built in Ingolstadt? Very boring town. Went there with my wife a year or so ago after spending a fabulous morning in the delightful Regensburg nearby. Ingolstadt very dissapointing in comparason, but I digress......... The finance guy said the interest rate would be one or two percent, but then mentioned the APR would be higher (their website implied 7.8%), so I will need to get behind what that means exactly in due course. He said it would be cheaper than having the money in an ISA, but I doubt that. We shall see. Also I don't have any money in an ISA :( Nearly new ones seem scarce and are expensive. As far as convertible driving is concerned, you are preaching to the 'converted' as I have a 'mid-life crisis car' - a 5.3 litre V12 Jag XJ-S convertible. Nothing like it to blow away the cobwebs and the stresses of a long day! |
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New Tue 12 Jul 11 10:46
Can someone enlighten me? PCP question. - PeterS
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>> Are they built in Ingolstadt? Very boring town. Went there with my wife a year >> or so ago after spending a fabulous morning in the delightful Regensburg nearby. Ingolstadt very >> dissapointing in comparason, but I digress......... Not sure about the convertible, but I'm pretty sure that the hatch is built in Hungary. I think the TT is as well so I wouldn't be surprised if the convertible was too Peter |
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New Tue 12 Jul 11 12:05
Can someone enlighten me? PCP question. - Londoner
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Where Audis are made. www.theaudiguy.com/files/audi-mfg-locations.jpg A3 cabriolet is built in Hungary. No worries. |
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New Tue 12 Jul 11 13:21
Can someone enlighten me? PCP question. - Slightlyfatdirector
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| Ah, Brettmick, you can have a PCP on a nearly new car? OK. Interesting, I assumed it was only on new. |
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New Tue 12 Jul 11 20:01
Can someone enlighten me? PCP question. - brettmick
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Yes. I had a PCP on a nearly new (9 months old) Saab. Terminated it after 2 1/2 years (as is your right) in early 2009 as the balloon plus remaining payments were almost double the price of a higher spec lower mileage model at a big car supermarket. This was the point that used prices were on the floor. The PCP worked in my favour financially but I had been realistic and the 20k miles a year was accurate. Replaced the Saab with the 5 door A3 on a very cheap PCP (4.9% APR from memory) and got about 20% off list price too. Very good price. Job change into London and using the train meant the car sitting in my garage for 3 months and I sold it back to Audi - for almost what I paid for it! In hindsight that was a mistake. More recently bought a 3 year old RAV4 on PCP and now the A3. New cars seem to get better PCP rates unless a "special" is running. There was a comment about not thinking of a PCP as financing the depreciation. It is more expensive than that, yes, but why is leasing generally more money? With a PCP you share the risk with the finance house, leasing its almost all with the leasing company. Buy a car outright and its all with you. It then depends on how long you want to keep the car - more than 3 years and a PCP is probably not right. My view is that of the opportunity cost of the money. £15k in a car that is losing £300 a month in depreciation (but I am "saving" £300 a month in payments) or £15k in my ISA so I can fix the boiler or have fall back cash. As with the car itself, everyones needs and financial position is different. |
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