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Who's bought their last tank of petrol?

Discussion in 'off topic' started by Cesare, Sep 13, 2021.

  1. Ponty

    Ponty pfm Member

    I’m sure I heard that fine fellow David Buik on the radio yesterday saying wage inflation was around 8%. Car prices have become ridiculous. A decent car was pretty cheap only a few years ago. When I started to drive, my mates and I all drove cheap bangers, we just didn’t care what it was. Now every new driver wants a new Fiat 500 et al. No wonder they haven’t got any money. Crazy!
     
  2. Nero

    Nero Call me 'Goose'

    I don't think anyone really looks at the headline prices any more. It's all now a question of monthly payments, rather like a Netflix subscription. I see many people who wouldn't otherwise buy a jalopy driving around in new SUVs. And why not? Unless the PCP comes back and bites them in three years.
     
    matt j likes this.
  3. gintonic

    gintonic 50 shades of grey pussy cats

    we are on our 11th lease/pcp - i only look at the headline price as i know what the upper bounds would be for a monthly lease/pcp repayment that is my max. I am way more interested in the monthly repayments and any deposit.
     
  4. matt j

    matt j pfm Member

    I might retrain as a HGV driver, I think basic is double what I currently earn according to some bod from Indeed on R4 this morning . No wage inflation here unfortunately.
     
  5. Nero

    Nero Call me 'Goose'

    Wise. The only thing I hate about PCP is the huge interest rates that are charged. I think the car companies make more money from that than actually building the car. How is 5-6% reasonable in this day and age, when I can get a mortgage for 1.5%? Yes, I know it's bricks and mortar, but the residuals of the car are factored into the monthly payments, and excess mileage and condition is well covered, so the risk is low I would have thought.
    Oh, the other thing I hate about PCP is that it is often sold inappropriately, so unwary buyers don't really think about what will happen when the term ends, and that's when they get stung.
     
  6. Ponty

    Ponty pfm Member

    Always good to have another string to your bow. Looks a tough job but can see how it could appeal to some.
     
  7. gintonic

    gintonic 50 shades of grey pussy cats

    i don't care about that. So long as the monthly repayment fits my budget.

    4% here

    I know nothing about that nor have heard anything. I never intend to pay the balloon as i never want to own the car outright. Never had a single handing the keys back. MB once charged me for a kerbed alloy. Recently i have stuck with the same manufacturer, which is useful for handing back and the next vehicle. I have had return damage charges completely waived three times, i have had dealer contributions to my deposit on the basis my return being lower mileage (for example) that expected etc..... I am content and feel happy with the finance services being offered to me by my dealer. They no longer moan when i buy gap insurance from elsewhere.
     
  8. clivem2

    clivem2 pfm Member

    I think 2.5% to 4% is reasonable…even lower is better of course. If someone wants to buy a car outright or use lower cost money, you can usually take out the PCP to gain the manufacturer/finance contribution and then pay off the PCP before the first monthly is due. The contribution does not normally need to be returned…this can be a significant flex to the calculation as to what works for some situations.
     
  9. jimbob75

    jimbob75 pfm Member

    With leasing / contract hire there is no option to buy the car outright with an end balloon payment.

    You can get stung with a PCP because the projected value of the car at the end of the term may be less than originally anticipated, so you can't cover a deposit on a new motor / PCP deal.

    My Golf R Mk7, bought new with PCP in 2014, ended up with no value to put against a new car, which, had I handed it back, would have essentially been a very costly lease.
     
  10. Ponty

    Ponty pfm Member

    You can’t compare the risk profile of a depreciating asset which can be put on a container to Eastern Europe or Africa to that of a house, hence rates are higher even for the best credit risks. I spent 20 years leasing stuff, mainly enterprise tech to corps (where it absolutely makes sense), but did some motor stuff in my early days. When PCP was being introduced and heavily pushed by the manufacturers, the trend was immediately very clear. People who had £250 a month to spend on a car could now strap themselves into a more expensive vehicle than under straight HP, at the expense of having little or no equity at the end of the term and paying more interest for the privilege. Which, to the delight of the manufacturers (and banks making a fortune out of it), is exactly what they did. It’s all fine until the music stops. It’s a perpetual debt wheel. Fine if you can afford it and have financial resilience but many who sign on the dotted line can’t and don’t. After spending so long in the industry and seeing all sides of it, I buy cars with cash.
     
  11. Bob McC

    Bob McC Living the life of Riley

    Add a zero more likely!
     
  12. Nero

    Nero Call me 'Goose'

    Thanks for that. I never did understand finance as a humble engineer. But you're right, it is a debt wheel for many. I also prefer to by cars for cash, but my predilection for new or ex-demo cars means the dealers (appropriate name) are really trying to make it difficult to do. The trick is to run them along for a while and then force a cash price out of them like blood from a stone. But they do try to hide it. I reckon they make more commission from the finance than the car. Any ex-salesmen here?
     
  13. chiily

    chiily PFM Special Builder

    I didn't spot anyone replying to this post, but it is a very good point.

    I don't know the figures, but I do know that old EV batteries are finding their way in to "house" batteries and there have a much longer life expectancy. And by using old EV batteries like this, with local generation of power, whether that be communal or personal depending on the type of house hold/need will take some of the pressure from the central electricity generating infrastructure. Once these house batteries are no longer useful they will be recycled, with some over all energy loss, but it does provide as least a recycling cycle for these materials, whereas for fossil fuels it is burn, turn to heat and discard - that is just not sustainable.

    It needs a different way of thinking from individuals, corps and government. There is no denying that burning fossil fuels is not the future and we are all going to loose some freedoms to drive ICE cars, so just get over it and get on with it; get some altruism in your life.
     
  14. Ponty

    Ponty pfm Member

    You wouldn’t believe some of the dealer finance commissions paid. On a chunky balance with a big balloon it could easily be north of £5K. I think the most I saw was £11K. The dealers don’t want your money, they want you to use theirs. Often the best approach is to agree to finance but drive the purchase price down as much as you can, then immediately withdraw from the finance agreement. You might pay a few quid in interest but it’s a rounding error.
     
  15. NeilR

    NeilR pfm Member

    Well said
     
  16. clivem2

    clivem2 pfm Member

    With my current car I was up front with the dealer, researched discounts which were 20% at that time, including finance contribution. I delayed paying off the PCP for a month so they got their slice and they refunded me the interest I paid. I could have bought nearly new for 25% off instead...which didn't make sense for me to do. Discounts now are very much lower due to the supply situation.
     
    Ponty likes this.
  17. Dave***t

    Dave***t Revolutionary relativist

    For the past couple of changes, I’ve tended to take my parents’ previous cars when they trade up.

    Most recently out of environmental concern I put a few thousand in to facilitate/bring forward their move from petrol to hybrid. So although I have their previous petrol car now myself, I kind of have an interest in the hybrid, plus it will likely come to me eventually.

    And that hybrid has had one tank of petrol in several thousand miles so far. Not quite an end to petrol, then, but a huge difference for the better in terms of petrol use so far.
     
  18. Eyebroughty

    Eyebroughty JohnC

    Hi,

    No electric car for me, or even any kind of car, driving licence stopped for good start of January this year, sold car, saved on petrol, garage rental, insurance, general running costs, tyres etc and garage bills.

    I take the bus, live in Scotland so that is free :D

    I cannot believe how much I spent running a car.

    Not having a car is not for everyone, but being retired, walking to the shops is fine, heavy shopping delivered to the door, more time outdoors walking, bus and trains are fine for my travel needs.

    The only down side I have is that I miss seeing the countryside I used to drive on each weekend to get to the coast.

    The upside is that it costs me next to nothing to do the journey to the coast by train and bus, takes an hour and a half longer but I have no road rage, traffic works, parking problems or car running costs.

    Not for everyone, but those that are retired should maybe have a think about doing something similar.

    Cheers

    John
     
  19. SteveS1

    SteveS1 I heard that, pardon?

    What you say is true. The Finance and Servicing is worth more to them than the sale of the vehicle. The way people are tied into main dealer servicing is a concern. The designed-in barriers to independent servicing is nothing short of criminal imo.
     
  20. NeilR

    NeilR pfm Member

    Steve, buy an EV. they hardly need any servicing ;-)
     

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