IJWS isn't the only one who's been perusing leasing sites; I'm wondering about it as an option for the S60's replacement and, like him, I've found some surprises. For example, a Golf GTI for less than a Golf 1.4 GT. And some very expensive BMWs.
But I really don't know what I'm doing or where to look, so I thought it might be useful to put our experiences in one place. Those of us in the market can tell our stories, and those who've been there and done it can tell us we're doing it all wrong.
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(A) leasing comparison site:
www.contracthireandleasing.com/
Last edited by: Focusless on Thu 19 Mar 15 at 15:07
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Fascinating. I could waste a lot of time in there.
Observation 1: a BMW 220d costs more to lease than a 420d. I wonder what this means for prices of two-year-old 220s.
Observation 2: some leases demand 44 'monthly' payments in a 36-month term. Clearly there will be spreadsheets.
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>>> I really don't know what I'm doing or where to look
Well probably here for a start... www.lingscars.com/index_min.php?status=pcp#models
About the only leasing site that is up front with VAT inclusive prices and all the details are there to allow a decision to be made about vehicles/deals which are actually available at that moment.
We leased from Ling 12/09 to 12/12 and it was a totally excellent experience. At the start the theory was that it would give us a new car for 3yrs at a lesser cost than the depreciation had we bought new and resold.... and so it worked out.
This was a private lease at a time when we had a huge amount going on (two house moves in a year, deconstructing a previous complicated life, 40ml school run each day and much more) so needed a fuss free reliable car with no involvement in the buying process or selling at the end plus fixed monthly costs.
Life changed loads as we expected towards the end of the lease so just let it go back and having more fun at much lower costs with older used cars now.
But if circumstances changed we'd go straight back to Ling. In fact we're seriously considering a 2yr lease for youngest daughter if she passes her test in a few weeks as a comparison to her getting a £1500 old car.
Last edited by: Fenlander on Thu 19 Mar 15 at 17:56
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>> But if circumstances changed we'd go straight back to Ling. In fact we're seriously considering
>> a 2yr lease for youngest daughter if she passes her test in a few weeks
>> as a comparison to her getting a £1500 old car.
I'd let her scrape the older one about a bit first
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Call me old fashioned, a cynic, nervous or whatever but signing up to an amount of money to spend every month for 2 or 3 years would require a confidence in my ability to continue earning enough to cover it for the period. I'd imagine it wouldn't be cheap to bale out early. Those who do commit to these deals must have a greater faith in the economy than I do !
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>> Call me old fashioned, a cynic, nervous or whatever but signing up to an amount
>> of money to spend every month for 2 or 3 years would require a confidence
>> in my ability to continue earning enough to cover it for the period. I'd imagine
>> it wouldn't be cheap to bale out early. Those who do commit to these deals
>> must have a greater faith in the economy than I do !
>>
Guess that's down to you as an individual. I've leased 3 cars and will probably do so again at some point. The commitment thing has never bothered me, but then my circumstances may be different to yours. I have a very stable job in a steady growth industry, combined with the fact that I work for a European employer who has a very positive long term view of the world.
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I'd want to be sure of having at least a year's payments in the bank before making the commitment. But that's equally true of buying outright - if that cleans you out - or taking on a loan; as with any aspect if life, hand to mouth is best avoided.
I get quite a lot of my income in one go as a performance-based bonus. In 2012 I used it to buy the LEC outright. I could do the same again with this year's, or I could keep it in the bank and use it to make payments on a lease or PCP plan for something new. I don't know the best answer yet; I'll put them all in the model and see what makes most sense. And of course I won't be swayed by what looks shiniest.
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>>>I'd let her scrape the older one about a bit first
Yes that's the advice I'd give anyone and what may well happen but she's really shaping up well as a learner with superb car control, great anticipation, uncanny vehicle spatial awareness... takes notice too and only has to be shown/advised once and she's got this or that sorted. She's a neat careful girl too in all aspects of life so if anyone I'd trust her with a new one.
Her sister before her on the other hand was only ever a candidate for her £1500 Polo... still puts me on edge every I travel with her and wonder how we manage to arrive anywhere with door mirrors intact. Having said that she's not scraped it at all in 8mths..... yet.
>>>signing up to an amount of money to spend every month for 2 or 3 years would require a confidence in my ability to continue earning enough to cover it for the period
Without going into great detail we only took it on as we had both income and capital to cover the costs. i.e. bit like WDB's situation we could have bought the car new outright without borrowing so that buffer was the safety net and as I said above it cost us less in payments than 3yrs depreciation so it was win-win.
Last edited by: Fenlander on Thu 19 Mar 15 at 21:26
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That's kind of my problem really. I never really know for sure what I'm going to earn next year and have no clue at all about the year after that. When times are good, they're very very good but when they're not, well, they're really really not. It's possible I might earn twice as much as this year or indeed I might earn half.
Keeps it all exciting I suppose...or so I've been persuading myself for decades. On average it hasn't been too bad but it's made me into a bird in hand sort of person as opposed to one who trusts in the future availability of the ones lurking in bushes.
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>>>When times are good, they're very very good but when they're not, well, they're really really not
F snr was like that (still alive but long retired) with some very high incomes earned abroad and in the UK plus property etc.... but he didn't worry about the future, had no pension, and spent the good year's surplus each year in that year,
In laws were the complete opposite with same home for 50yrs, modest cars, modest aspirations and it will come as no surprise the tortoise vs hare fable played out true to form comparing the two families.
I was brought up a hare but the tortoise family taught me a lot and I've 90% adopted their ways.
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I have the energy of the tortoise but the tastes of the hare.
Inconveniently...
;-)
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Yes well I have ways of dealing with that across many ways of life... i.e. the £30,000 worth of fun (in new car terms) I had from the sub £1000 Alfa.
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The true art of living is learning to satisfy champagne tastes on a Vimto budget.
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>> The true art of living is learning to satisfy champagne tastes on a Vimto budget.
>>
For me, the true art of living is to accept that one has tastes for anything at all over and above just staying alive, and that any kind of pleasure or champagne tastes are not there to to induce guilt, nor should they be suppressed to the detriment of your mental health. A lesson I haven't yet learned and probably never will.
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Leasing is very popular over here in Aus- OK, it's a different market where there are tax incentives (you can lease from your pre-tax salary and BIK/FBT is easily avoided) but there are parallels. Also, I 'worked the numbers' a few times when deciding whether to run my own or a company car in the UK (where you benefit from the VAT if it's a company lease).
Put simply, the lease cost should be the actual cost of running the car over the time you have it (depreciation, maintenance, cost of money) plus some profit element for the leasing company.
The leasing company may get a better discount on the purchase cost than you can (but then companies like Drive the Deal can probably almost match this). Depreciation is the biggest cost, that's why you get apparent anomalies like a Golf GTi costing less than a 1.4TSi. The cost of money is very small and maintenance is pretty much the same for all cars in a range. Beware that most optional extras will be completely depreciated by the leasing company over the lease and any residual value will be extra profit for them.
It's the size of the profit element which you need to trade off against your perceptions of value from convenience, simplicity etc on the 'upside' and lock-in, financial commitment and inflexibility on the 'downside'.
Last edited by: idle_chatterer on Thu 19 Mar 15 at 22:36
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Manufacturer's appear to use leasing to offload cars in lieu of more obvious discounts.
The Golf R for £200/month being a prime example.
www.hotukdeals.com/deals/golf-r-tsi-300bhp-personal-lease-178-79-month-inc-vat-6692-17-centralvehicleleasing-2013734
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>> The Golf R for £200/month being a prime example.
I was about to place my order when I read this in a review:
...so the Golf R again utilises a ‘soundaktor’ (sound actuator) for extra throatiness.
In short, it’s a hockey-puck-sized resonator that lives under the weather panel at the base of the windscreen, and it vibrates and resonates through the screen, making a noise – an artificial one, granted – akin to a bigger, throbbier engine.
FFS! So we're keeping the Colt for now.
www.autocar.co.uk/car-review/volkswagen/golf-r/performance
:)
EDIT: yes I know it's not the only car to do this, the BMW i8 being another example but at least that has the electric excuse
Last edited by: Focusless on Fri 20 Mar 15 at 07:32
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That may have been the device that made the noises I objected to in the GTI. I'm sure it's controlled from the central computer and can be disabled, by the dealer if not the user.
That is an astonishing deal, perhaps similar in behind-the-scenes finances to the one that has put so many C63 AMGs on the road. The importer may lose money on each individual car but is aiming to create a halo effect that will drive buyers into dealers in search of lesser Golfs and MBs.
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>> EDIT: yes I know it's not the only car to do this, the BMW i8 being another example but at
>> least that has the electric excuse
I was told by a BMW employee at BMW World that the i8 has the exhaust tuned to sound more like a V8. It does not use any electronics. From outside the car it certainly sounded rather good.
The Golf on the other hand does use some form of sound generator. And this can only be heard inside the car. It used to be standard on the Golf GTD/GTI but then it became an option. It was enabled when you put the Driver Profile system to Sport. It is part of the Sport and Sound pack. From the website:
Sport & sound pack
This sound generator enhances the aural sensation for the driver and other passengers. In 'Sport' mode (using the Driver Profile Selector) there is an additional acoustic emphasis to the sound of the engine inside the car, with no additional noise externally.
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>> I was about to place my order when I read this in a review:
>>
>> ...so the Golf R again utilises a ‘soundaktor’ (sound actuator) for extra throatiness.
>>
>> In short, it’s a hockey-puck-sized resonator that lives under the weather panel at the base
>> of the windscreen, and it vibrates and resonates through the screen, making a noise –
>> an artificial one, granted – akin to a bigger, throbbier engine.
FIL has this on his Leon FR - took it back to the dealer after a week and had it turned off as it was annoying him. Loves the car in every other respect
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That Golf R deal was from Central UK Vehicle Leasing - and was months out of date. But the company looks reputable, and has current Golf GTI deals at under £300 inc VAT. Small print may be an issue - they want a £2000 advance payment, and the mileage is capped at 8,000 a year. It's only for two years too; three is priced much higher, so who knows what's in the background driving all this. Anyway, gives me something to think about.
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>>so who knows what's in the background driving all this
I reckon it is about getting a good supply of low mileage second hand cars to the dealer network in a couple of years time to drive customers to the dealers and potentially buy a new model or it could simply be getting rid of overproduced models without the right option set.
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The deals are usually related to oversupply. If you are not to fussy and will be prepared to be flexible then there are some good deals to have.
My last lease was a Volvo V60 - not something I has considered, but it was a new model not long out, and very few on the road. Think it was something like £200 + VAT and £600+ VAT upfront for 2 years. At the time it was a 28K. I think if my man maths were correct then the depreciation would have been more over the two years than the cost to lease.
One thing I dont like is that a lot of attention grabbing lease deals are being advertised with silly 5K mileage allowances or high upfront payments. Means you have to be a bit careful comparing like for like. When I first leased nearly all deals were 3 payments up front and sometimes 6
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On hard to source models the cost of leasing will be high.
Where there is an oversupply / wrong spec the Leasing Company can buy at say 40% off.
Manufacturers who need to shift stock cars without advertising huge Price Drops which can frighten punters. They can simply offer very low leasing rates and then get their stock correct for the business they do.
In 1999 I bought a Xedos with 2000 miles on the clock. I had an issue with "A LARGE SCOTTISH DEALER THAT IS PRIVATELY OWNED"
My lawyer obtained the car history & invoices of the original sale List Price inc VAT was £22K - the original invoice was £12K + VAT. I paid £15K (inc VAT) when the car was some 6 mths old - Original invoice was for 40 cars - all Satellite Blue - some manual, some auto.
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>> Where there is an oversupply / wrong spec the Leasing Company can buy at say
>> 40% off.
Yep, it was back in 2009 that I last leased a car (or indeed lived in the UK), the recession was in full swing and BMW were obviously offering significant discounts to leasing companies, I cannot honestly remember the exact amount I derived from my 'reverse engineered' calculation but it might have been 23% or even 27%.
IIRC, before what I commonly hear referred to as the GFC, daily hire companies made a turn in the same way that FB describes, they'd get Focus/Astra at some huge discount, run them for 6 months and 12K miles (to avoid any servicing costs) then send them to auction for at least what they paid for them if not more. A nice business model and the manufacturers' registration figures were kept up, arguably punters benefited in a steady stream of newish (but unserviced) cars in the car supermarkets albeit with significant 'rent appropriation' by the hire companies and dealers.
In the end, there is no magic formula, the leasing company is in business so wants to make a profit, do the maths as that profit will be coming from you the customer.
Last edited by: idle_chatterer on Sat 21 Mar 15 at 12:58
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Its all very well opting for a low mileage lease, but what happens if your life changes, say half way through? My mileage has risen 25% since my boy went to uni, and is showing signs of rising further. Not a problem personally, but aren't the excess mileage charges punitive?
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Yes, those unexpected 18th birthdays can be a nightmare.
};---)
One site I've been looking at has spectacular-looking prices for 8,000pa that almost double if you want even 10,000. It's hard to see what the additional charge per mile would be. But as always, you need all the data before making a commitment; I'm only playing with the idea for now.
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I've only privately leased a car once.
In that particular instance it was cheaper to take a lease for a lower mileage and then pay the excess mileage penalty at the end.
Last edited by: No FM2R on Tue 24 Mar 15 at 09:09
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Yep that was broadly my experience No FM. I kept within my 15K/yr contract OK but had I gone over it was only 2.5p/ml excess so even an extra 10k at the end would have been just £250... less than one month's payment and nothing in the scheme of a 3yr lease.
That C1 is a cracking deal Mikey... saves about £1k over the 2yrs even allowing for the larger than usual initial payment. Daughter is attempting first test very soon and she's left off discussing possible cars at the moment... I suspect to avoid anticipating a pass too much.
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I'm leasing the Transporter, but oddly there is no mileage limit. Maybe that is the norm for commercials?
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>> I'm leasing the Transporter, but oddly there is no mileage limit. Maybe that is the
>> norm for commercials?
>>
No, not the norm. I suspect you have some kind of other finance product that's designed to be tax efficient maybe?
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Interesting discussion over on Piston Heads just now regarding the financial/insurance situation in the result of a total loss claim early in the contract having paid a substantial first payment.
www.pistonheads.com/gassing/topic.asp?h=0&f=23&t=1507309&nmt=
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I thought gap insurance was always a vital requirement?
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Gap insurance covers your obligation to the finance company. The problem is that you may have paid £2,000 or more upfront, then wrecked the car in month 1. If the lease terminates at that point, you've paid all that money for one month's use, and that's not an insurable loss.
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Leasing for dummies - Focusless
