I was speaking to a chap who had returned is 3 year old lease car 5 series 35K miles.
List Price was £43K in 2015
He had paid £12K in 3 years
GMFV was £25K
Lease company said he could have it for £17K instead of £25K and lets them off auctioning it.
In effect if you add the lease payments over 3 years to the £17K it only comes to £29K! 33% off
Smoke & mirrors.
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So it was a PCP not a lease?
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Of the last 4 cars that I have bought new (and for cash) the discounts (against new retail price)have been 37 38 33 and ~ 30 %. Maybe not from premium manufacturers, but I am not a volume or trade buyer, just aware of what can be negotiated. (3 from dealers, 1 via DtD). None were runout models or odd specns. Purchase dates of 2016, 2014, 2008 and 2006). I still have the last 3.
A figure of 33% therefore does not surprise me. But not sure that I could find the same discounts now, with the devaluation of the £.
Last edited by: sherlock47 on Wed 3 Oct 18 at 14:44
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>> In effect if you add the lease payments over 3 years to the £17K it
>> only comes to £29K! 33% off
More than 33% when the timing of the payments is taken into account - he didn't have to pay the £29k up front, and £17k of it was delayed for 3 years.
Car manufacturers can't reduce production volumes quickly without big diseconomies. When they have made too many, this is one of the ways they liquidate the surplus without trashing the price for everybody.
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>> I was speaking to a chap who had returned is 3 year old lease car
>> 5 series 35K miles.
>>
>> List Price was £43K in 2015
>> In effect if you add the lease payments over 3 years to the £17K it
>> only comes to £29K! 33% off
You are assuming the lease company paid List. They didn't. A 33% discount for lease companies is not unusual. Plus you forgot VAT.
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>> I was speaking to a chap...
I'm sure he told you what you've written but I find people often talk nonsense about car finance.
For one thing, as someone else pointed out, there's no GFV with a lease. If it's a PCP, then likely he paid a hefty deposit. If it's a lease, he will have paid some months 3/6/9 as an advance payment, as well as 35 monthly payments. People telling you stories about their car always ignore the initial payment / px - it's like they're in denial about it
If it's PCP I've never heard of the company accepting less - and I've seen plenty of cases of people who asked. It's a common complaint on forums where the finance company sets the GFV high then people find they're being asked to pay more than the car is worth if they want to keep it.
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>>
>> If it's PCP I've never heard of the company accepting less - and I've seen
>> plenty of cases of people who asked. It's a common complaint on forums where the
>> finance company sets the GFV high then people find they're being asked to pay more
>> than the car is worth if they want to keep it.
>>
Not a PCP I know, but I initially leased my BMW because it looked to me as if the cost over the two years would be far less than buying / PCPing it. 3 months before the end of the lease I asked for a cost to buy it at the end. They quoted just over £21k, which would have made the total cost (including the 3+23 payments) just over £32k. I had a number of email reminders over the following weeks, but I did nothing with that quote. Two weeks before the lease ended I got a revised purchase price email from alphabet of just under £18k, taking the total to a fraction over £29k, so I bought it. List price when new was around £39k including options. I couldn’t get 25% off a new one in 2016, so I was happy enough. And leasing includes the road tax, which is £290, in year 2.
So alphabet, who’ll be the finance company behind BMW PCPs, are willing to move on lease purchase prices at least!
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My Renault Zoe was on a pcp. At the end, I kept an eye on the forums. Very many people who had bought roughly when I did asked for a reduction in the final price to buy, as the GFV was more than the trade in value, and very many got it. It seemed to be a reduction from about 7k GFV to about 5k accepted.
I didn't ask as I didn't want it anyway, but Renault (RCI actually) were definitely reducing final purchase price for a few months.
No longer do they do that, as they stopped doing the cheap deals in the first place, of which mine was one.
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BMW 5-Series E?? - Where did the BIG cash difference come/go from - Manatee
