Sancho Panza

BoE investigates 'terrifying' rise in borrowing to fund new car purchases

203 posts in this topic

31 minutes ago, Kipperwood said:

Hi I've been reading HPC with interest, just a quick question. As I understand it, when someone takes out a PCP agreement the garage sets a future minimum guarantee value, from which you can walk away etc etc. They know the current price of 2, 3 and 4 year old cars and can make a good estimate of what that might be.

But have they considered a large downwards price shift? With the government now seeming to increase the  tax on diesel cars, they are predicted to fall in value. Surely they could not see this fall coming and if loads of people walk away, the garages will be left with loads of cars that could be several thousands of pounds less than their original sums. 

As I also understand it there has been a huge increase in diesel cars bought in the last few years. When enough people turn away from Diesel fuel, will this be the biggest problem for PCP. The finance company's would be left with a huge stock that is now under valuation. Thanks 

Diesels took a big hit, falling by 9.2 per cent compared on this time last year -  

Slow month of February as buyers shun diesel models ahead of 17-plate registrations and tax changes  

 

http://www.autoexpress.co.uk/car-news/consumer-news/94714/new-car-sales-down-in-february-2017

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Correct me if I'm wrong, but government (so far) has decided to raise taxes & VED on new cars only? Our family fleet includes two cars that have £0 and £30 VED and they were the same last time I bought them (the £0 was last month).

My 30 year old motorbike was £85 :(

 

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17 minutes ago, buckers said:

Correct me if I'm wrong, but government (so far) has decided to raise taxes & VED on new cars only? Our family fleet includes two cars that have £0 and £30 VED and they were the same last time I bought them (the £0 was last month).

My 30 year old motorbike was £85 :(

 

yes, but there is £10 daily charge for pre 2006 diesels coming into force in Oct 2017 for london congestion charge 

 

http://www.telegraph.co.uk/news/2017/02/17/drivers-older-diesel-cars-charged-extra-10-enter-london/ 

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I don't suppose there is nothing to stop them from putting up car tax on existing diesel cars, in time, if they thought they could.

But it is the indirect taxes like the above mentioned congestion charge and even parking charges in certain areas. Once one council is taking more revenue that way, they will roll out the same policy's to a wider area.

I drive a 4 year old VW transporter van that is diesel, like most vans out there. It is almost unheard of to have a petrol engined van but my first transit van was indeed a petrol engine, back in the early 90's. Ex BT fleet that was still yellow in colour. 

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5 hours ago, Kipperwood said:

Hi I've been reading HPC with interest, just a quick question. As I understand it, when someone takes out a PCP agreement the garage sets a future minimum guarantee value, from which you can walk away etc etc. They know the current price of 2, 3 and 4 year old cars and can make a good estimate of what that might be.

But have they considered a large downwards price shift? With the government now seeming to increase the  tax on diesel cars, they are predicted to fall in value. Surely they could not see this fall coming and if loads of people walk away, the garages will be left with loads of cars that could be several thousands of pounds less than their original sums. 

As I also understand it there has been a huge increase in diesel cars bought in the last few years. When enough people turn away from Diesel fuel, will this be the biggest problem for PCP. The finance company's would be left with a huge stock that is now under valuation. Thanks 

 

There will be a margin built in to anticipate downward shifts, though of course that may not be enough if the drop is really big.

 

  As I noted in an earlier post, I think VW Finance might be about to take a large hit on stupidly cheap Golf GTD leases that they were offering just prior to 'Dieselgate'.  In that case, the people taking the leases are quids in vs if they had bought the car brand new and sold after 2 years.  Although as I have pointed out, the real issue here is that buying new and selling to buy another new car after 2-3 years is financially never a great idea and finance deals (PCH/PCP) are just another way to do this with the depreciation costs structured differently and vastly reduced upfront costs, thus dragging in many punters who would never do it 'the old fashioned way'.

 

 

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24 minutes ago, Sour Mash said:

There will be a margin built in to anticipate downward shifts, though of course that may not be enough if the drop is really big.

  As I noted in an earlier post, I think VW Finance might be about to take a large hit on stupidly cheap Golf GTD leases that they were offering just prior to 'Dieselgate'.  In that case, the people taking the leases are quids in vs if they had bought the car brand new and sold after 2 years.  Although as I have pointed out, the real issue here is that buying new and selling to buy another new car after 2-3 years is financially never a great idea and finance deals (PCH/PCP) are just another way to do this with the depreciation costs structured differently and vastly reduced upfront costs, thus dragging in many punters who would never do it 'the old fashioned way'.

Maybe we need some HPCers to stand guard and barricade the dealerships... and break the grip of those being dragged in.

It's their own choice. :) It doesn't have to make financial-sense to anyone else.   :)   Other individuals don't need approval for their financial/car choices. :)

Self-validating Kia/Yaris drivers 

I could be a real tw@t about it, and have decided to be.  

>>> I like driving a high-end fancy modern Merc SUV.  It doesn't mean you are a total failure if you're driving a 5 year on Kia. <<<

Sure there are people who are really like that, but I defend their choice.  It's their money, or their debt and their choice.   

It's just the reverse of smug people who think the PHP/PCP are incapable victims, and that 'most people' have no idea what they are doing when buying PCH/PCP.

And people make their choices for many reasons, including safety, design looks.  It's just their choice.  Of course it costs more.  New car!!!  New car every 3 years or so when people do that.  It costs more.  And there is some margin in the finance deals for default risks, and toward other events such as some issue with vehicles causing significant deeper depreciation.   And sometimes it can be fair value, as in the example you give it is even possible that the Golf GTD lease takers.

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1 hour ago, Venger said:

Maybe we need some HPCers to stand guard and barricade the dealerships... and break the grip of those being dragged in.

It's their own choice. :) It doesn't have to make financial-sense to anyone else.   :)   Other individuals don't need approval for their financial/car choices. :)

Self-validating Kia/Yaris drivers 

I could be a real tw@t about it, and have decided to be.  

>>> I like driving a high-end fancy modern Merc SUV.  It doesn't mean you are a total failure if you're driving a 5 year on Kia. <<<

Sure there are people who are really like that, but I defend their choice.  It's their money, or their debt and their choice.   

It's just the reverse of smug people who think the PHP/PCP are incapable victims, and that 'most people' have no idea what they are doing when buying PCH/PCP.

And people make their choices for many reasons, including safety, design looks.  It's just their choice.  Of course it costs more.  New car!!!  New car every 3 years or so when people do that.  It costs more.  And there is some margin in the finance deals for default risks, and toward other events such as some issue with vehicles causing significant deeper depreciation.   And sometimes it can be fair value, as in the example you give it is even possible that the Golf GTD lease takers.

 

Jeez, you really have been triggered haven't you?

 

Look, no-one is getting at you personally when they point out that finance deals have essentially sucked in a lot of people into paying the costs of running an expensive new car which they wouldn't otherwise consider if they were faced with up-front costs of purchase first.

 

But judging by the amounts of new metal on the road and the generally crappy state of people's finances, it's pretty clear that the effect of cheap finance deals has been to entice people to spend more based on seemingly affordable monthly costs for something that is really costly.  A bit like how people get the latest iPhone every 2 years on a contract (and think that paying 45 quid a month for 24 months makes their iPhone affordable), or how people think that an overpriced shoebox is somehow affordable because they can secure a 2 year fixed interest rate mortgage that appears to make their massive commitment very affordable (on a monthly basis).

 

If you personally decide to spend lots of your money on switching new cars every couple of years, more power to you and you can choose to finance it whatever way you like.  But finance has undeniably moved the market towards people spending a lot more on cars in general (on the basis of expensive metal for monthly payments) and isn't sustainable in the long term.  Once interest rates rise, it'll kill the market dead and people exiting a finance deal and looking for a new one are going to get a nasty shock regarding what car they can afford to drive .. much the same shock as people on 2-year mortgage fixes are going to get.

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Does anyone have the figures on how many people actually pay off the deal at the end of three years rather than just hand it back /trade it in for a new one?

 

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2 hours ago, Sour Mash said:

Jeez, you really have been triggered haven't you?

Look, no-one is getting at you personally when they point out that finance deals have essentially sucked in a lot of people into paying the costs of running an expensive new car which they wouldn't otherwise consider if they were faced with up-front costs of purchase first.

But judging by the amounts of new metal on the road and the generally crappy state of people's finances, it's pretty clear that the effect of cheap finance deals has been to entice people to spend more based on seemingly affordable monthly costs for something that is really costly.  A bit like how people get the latest iPhone every 2 years on a contract (and think that paying 45 quid a month for 24 months makes their iPhone affordable), or how people think that an overpriced shoebox is somehow affordable because they can secure a 2 year fixed interest rate mortgage that appears to make their massive commitment very affordable (on a monthly basis).

It is the principle of the matter.  

Superior analysts casting those with car finance debt as having been duped/dragged in, and because buying a new car on finance is not usually as financially sensible as buying an older car, casting them as victims.  Self-validating.  And now I see you bring it back to your mortgage victims.... adults can see the asking prices (alone for some of us to gasp at in this market) and weigh up basic risks. :rolleyes:

4 hours ago, Sour Mash said:

...Although as I have pointed out, the real issue here is that buying new and selling to buy another new car after 2-3 years is financially never a great idea and finance deals (PCH/PCP) are just another way to do this with the depreciation costs structured differently and vastly reduced upfront costs, thus dragging in many punters who would never do it 'the old fashioned way'.

'Dragging'-in/Dragged-in (to debt) is the code-word of way too many HPCer 'superior analysts' and I have pushed back against it for some many years.

Including against those on the homeowner AND BTLer side who seemingly hope/position for savers to be wiped out, and ready to embrace a big happy bailout for those with mortgage debt, to protect the HPI+++++++.

hmmmmmm.......

On 11/2/2016 at 1:15 PM, Sour Mash said:

Yes, bail-ins are on the books from here on in.

In a way, they are actually fairer than full on state bailouts.  If you have stupidly entrusted your wealth to a bank (i.e. exchanged it for bank credit) without doing your homework, then you should bear some/all of the consequences of that bank going belly up.  The idea that bank savings should be sacrosanct is just an implicit guarantee for the state to support the banks bad business practices, no matter what happens.

 

Quote

Venger: (to Sour Mash) Alternatively there could be a big HPC.  No one dragged you into buying a house, and taking on mortgage.

 

On 12/16/2015 at 8:53 AM, Venger said:

Real estate runs on money. The BTLers are active market participants. No one dragged them into any bank and forced them to sign up to jumbo debt in unregulated market, to people-farm their fellow citizens.

More....

On 7/26/2015 at 5:09 AM, Venger said:

What might banks do in the future is the point. No one is dragging people to the banks and forcing them to take out mortgages, to buy at these prices.

Want house? Apply for mortgage, pass MMR checks, get low-rate happy mortgage, buy house. Almost that simple + other fees. There can be no complaint if, in a few years time, some young couple buy next door for 50% less than you paid.

 

On 1/16/2016 at 11:40 AM, Venger said:

Tell me when they're dragging the buyers to viewings and forcing them to buy..

 

On 5/24/2016 at 8:50 PM, Venger said:

Yay. Would be nice if so.

Have the EAs now finished dragging everyone that could be reached to viewings of super-expensive houses, and bankers finished dragging in people off the street to sign jumbo mortgage contracts for dream homes? hehe.

 

On 6/30/2015 at 9:05 AM, Venger said:

It's their life.. their blood sweat and tears. No one is dragging them into £350K mortgages. Their lives.

 

On 2/13/2017 at 10:54 AM, Venger said:

 

On 2/10/2017 at 3:53 PM, ccc said:

Venger I'm not saying people are innocent in any of this. They should do their own research. 

But there has been brainwashing on a massive scale in the UK over decades. 

Of course people should do their own research - but that's in theory

All I am saying is there are a few very simple explanations and examples you can give to people that really make them sit up and listen. 

:rolleyes:

There's loads of it on HPC.  People who believe adult owners/buyers are victims of a scam, and need 'the truth'.  Read it for years as prices up 30%-doubled.

ccc is no wacko but even he edgse into easy 'answer' - on this thread - of 'brainwashing on a massive scale' for the world around us.  

Adult market participants in market.  Own choices. Buyers at ever higher prices in many areas.  Some HPCers sat on £1m+ of equity.  People who have advanced quality of life in many ways with their choices in other markets, for us all.   If I had to give my view, it is those who claim 'brainwashing' are actually the 'brainwashed' giving such an easy answer for the world around us, and especially when all too often they are on the wrong side (financially) of this market.

What do I accuse them of doing?  Rubbishing other people and their choices, and acting superior.

Yes there is advertising and influencing all around us - but we all have our own minds make our own market choices.   No one is dragging anyone into buying £850K terraces in Cambridge.   I refuse to treat those who buy houses, or sat on £1m+ of equity in their own houses which they enjoy possession and living in (a few HPCers included) as brainwashed.

The 'alternative' some seem to want is back to grey-communism with their own stasi, to police 10ms of people to 'the truth' - what is a better alternative than what we have now, of free people allowed to make their own market choices?

Even extends to who people can date... if a relationship goes wrong (breakup), not personal decisions/individuals at fault in any way, or relationship they entered not strong enough to last, but "society propaganda".  Victimhood.  Cast away all responsibility.  Some  big bad at fault.  Begin bailout type thinking.ush back against it.

....It's an easy basic trap to fall into.   Seeing oneself as the superior analyst who can see everything wrong that 10s of millions of other people 'obviously can't see' and need 'the all-knowing saviour truth'.  It's a market out there, with 100s millions of different market view points, different VIs.

 

Edited by Venger

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14 hours ago, Sour Mash said:

Although as I have pointed out, the real issue here is that buying new and selling to buy another new car after 2-3 years is financially never a great idea and finance deals (PCH/PCP) are just another way to do this with the depreciation costs structured differently and vastly reduced upfront costs, thus dragging in many punters who would never do it 'the old fashioned way'.

 

12 hours ago, Sour Mash said:

Jeez, you really have been triggered haven't you?

Look, no-one is getting at you personally when they point out that finance deals have essentially sucked in a lot of people into paying the costs of running an expensive new car which they wouldn't otherwise consider if they were faced with up-front costs of purchase first.

But judging by the amounts of new metal on the road and the generally crappy state of people's finances, it's pretty clear that the effect of cheap finance deals has been to entice people to spend more based on seemingly affordable monthly costs for something that is really costly.  A bit like how people get the latest iPhone every 2 years on a contract (and think that paying 45 quid a month for 24 months makes their iPhone affordable), or how people think that an overpriced shoebox is somehow affordable because they can secure a 2 year fixed interest rate mortgage that appears to make their massive commitment very affordable (on a monthly basis).

 

--------------------

Tenants refusing to pay rent
Started by rollover, March 30

On 3/30/2017 at 2:59 PM, Sour Mash said:

Lots of people living 'flash' lifestyles do so by running up and dodging repayment of, large debts.

Seriously, you've got the question the mentality of someone constantly seeking to show off how flush they are on social media.  It doesn't exactly scream 'this person is genuinely hard working and wealthy as a result' to me .....   If I was a landlord, on top of any other references and metrics, I'd definitely consider gathering as much info as possible on potential tenants via social media before letting.

 

On 3/30/2017 at 3:22 PM, 24 year mortgage 8itch said:

Suppose you're a highly leveraged ******wit masquerading as a landlord and you wish to play God, using your over inflated sense of self worth, by selecting which particular serfs are blessed enough to live in a property owned by you, a leader amongst men...

Just who is going to pay your mortgage if no one is good enough for you?

 

On 4/2/2017 at 10:40 AM, Sour Mash said:

Get that chip off your shoulder - Seeking not to end up with a bunch of crap non-paying tenants is a perfectly sensible and reasonable course of action for someone looking to let out a property.  And offering housing in return for rent is an entirely reasonable thing to do, especially since social housing is so heavily oversubscribed and under-provisioned.

Or would you just prefer it if private rental wasn't a thing?  Presumably in your la-la world there would be an unlimited amount of social housing and properties could be purchased outright for a few tens of thousands?

Yes.  HPC.  BTLer unregulated lending HPC where there it's not any form of fair capitalism imo (MEW/IO BTL/ rent it out).  And not your saver bail-in dream.

On 4/2/2017 at 10:54 AM, 24 year mortgage 8itch said:

And you don't have a chip on YOUR shoulder about conspicuous consumption? Boot? Other foot? 

Where do tenants get to find out about their Landlord's liabilities, general financial situation and likelihood of getting things done when needed and not be sheared like a sheep whenever the landlord feels like it?

Can't help but find it somewhat amusing @Sour Mash (but with a sad sigh) that you are so against other people being capable of making their own adult car choices as individuals with their own minds, but seem perfectly okay with the BTLing and that sort of 'capitalism' which has gobbled up so many homes (and held them off them market) while being a big driver of HPI++++.

BTLing/landlording property to rent out an 'entirely reasonable thing to do for the rent'.... on mainly younger people (imo) who are priced out with less affordable homeownership options that generations before them, because of a huge BTLer double down.......  but a car on PHP/PCP and it's man the barricades, 'people don't know what they are doing',  'dragged into it' and 'suckered in'. :rolleyes:

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12 hours ago, Sour Mash said:

...A bit like how people get the latest iPhone every 2 years on a contract (and think that paying 45 quid a month for 24 months makes their iPhone affordable), or how people think that an overpriced shoebox is somehow affordable because they can secure a 2 year fixed interest rate mortgage that appears to make their massive commitment very affordable (on a monthly basis).

 

RUNXFOVG.jpg

 

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On 21/04/2017 at 1:23 AM, Ah-so said:

The reliability of German cars is a myth they still profit from without having to produce the goods. None of the reliability surveys have German manufacturers at the top. 

http://www.autoexpress.co.uk/car-news/consumer-news/91220/the-most-and-least-reliable-car-manufacturers-2016

http://www.whatcar.com/news/skoda-tops-new-uk-vehicle-dependability-survey/

 

A friend of my Dad is a mechanic and describes German cars as working cars - you never stop working on them. Kept him in business.

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12 minutes ago, Kurt Barlow said:

A friend of my Dad is a mechanic and describes German cars as working cars - you never stop working on them. Kept him in business.

Mark Twain noted that a man with a reputation as an early riser can sleep until noon.

Likewisr, German manufacturers have benefited from their reputation as producers of reliable motors while producing cars that slip down the reliability  tables and are expensive to repair. 

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Perhaps you can both inform the wider world about German cars, and everyone can choose what you think is best, else be uninformed. :lol:

So everyone to choose what.... Toyota?

Or if true, perhaps a valid reason for some to PHP/PCP for 3 years, rather than run older version.

And Sour Mash can scour the net with his landlording capitalist dreams, to decide who he would rent to, while dreaming of saver bail-in.

I've not had any real problems with German cars.   Audi and VW.

Owned one for 10+ years, and only had to change a coil-pack occasionally.  

Got an original VCDS cable (need a pic grr) to tell me which one was misfiring and other diagnostics + service reset.   https://www.gendan.co.uk/vcds-hex-usb-can.php

Brake-pedal-switch (no brakelights) went through a few updates and bought 2 at around £20 each.

Oh yeah there was once a replacement throttle body required for my brother's car (could tell it was that from a block read)... £40 on ebay vs £300 new, and probably our own fault for breaking the throttle-body (with internal sensor) for once absolutely ragging it on revs into the red*

*edit: not on public highways. (safety)

Edited by Venger

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4 minutes ago, Venger said:

Perhaps you can both inform the wider world about German cars, and everyone can choose what you think is best, else be uninformed. :lol:

So everyone to choose what.... Toyota?

Or if true, perhaps a valid reason for some to PHP/PCP for 3 years, rather than run older version.

And Sour Mash can scour the net with his landlording capitalist dreams, to decide who he would rent to, while dreaming of saver bail-in.

I've not had any real problems with German cars.   Audi and VW.

Owned one for 10+ years, and only had to change a coil-pack occasionally.  

Got an original VCDS cable (need a pic grr) to tell me which one was misfiring and other diagnostics + service reset.   https://www.gendan.co.uk/vcds-hex-usb-can.php

Brake-pedal-switch (no brakelights) went through a few updates and bought 2 at around £20 each.

Oh yeah there was once a replacement throttle body required for my brother's car (could tell it was that from a block read)... £40 on ebay vs £300 new, and probably our own fault for breaking the throttle-body (with internal sensor) for once absolutely ragging it on revs into the red*

*edit: not on public highways. (safety)

Irrespective of what Joe Public thinks the surveys posted by Ah - So suggest otherwise.

People are free to chose whatever they want. The point is though that German reliability does not always stack up when compared against other countries vehicle marques.

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41 minutes ago, Kurt Barlow said:

A friend of my Dad is a mechanic and describes German cars as working cars - you never stop working on them. Kept him in business.

I think the 'premium' brands manage to paint running and servicing costs as part of the mystique of keeping a premium machine running optimally. As if they are so special that without the constant and gentle fondling of a 150 quid an hour mechanic the car would simply wither away and die.

Japanese cars are different but i saw the same mentailty in a company director who had bought a impreza wrx sti. Told everyone how special the car was that it needed 3 services by 10k miles, including being taken back at 1k to check it was 'settling in properly'.

Subsequent owners buy the cachet but may not feel the same about servicing costs etc. My sister in law has this problem...shes just remortgaged as her 12 yo 3 series threw a £3k Garage bill. No idea whether shes repairing the old one (a poverty 320d) or buying another.

Im a big fan of the smoker barges 1-5k thread on pistonheads. Loads of great 30-100k cars being discussed that can mow be had for 'pennies'. But. Some of the ownership/cost experiences shared on the forum are eye watering!

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9 minutes ago, Venger said:

Perhaps you can both inform the wider world about German cars, and everyone can choose what you think is best, else be uninformed. :lol:

So everyone to choose what.... Toyota?

Or if true, perhaps a valid reason for some to PHP/PCP for 3 years, rather than run older version.

And Sour Mash can scour the net with his landlording capitalist dreams, to decide who he would rent to, while dreaming of saver bail-in.

I've not had any real problems with German cars.   Audi and VW.

Owned one for 10+ years, and only had to change a coil-pack occasionally.  

Got an original VCDS cable (need a pic grr) to tell me which one was misfiring and other diagnostics + service reset.   https://www.gendan.co.uk/vcds-hex-usb-can.php

Brake-pedal-switch (no brakelights) went through a few updates and bought 2 at around £20 each.

Oh yeah there was once a replacement throttle body required for my brother's car (could tell it was that from a block read)... £40 on ebay vs £300 new, and probably our own fault for breaking the throttle-body (with internal sensor) for once absolutely ragging it on revs into the red*

*edit: not on public highways. (safety)

I owned a Toyota Avensis for 4 years which I sold to my Dad (3 years) who sold it to my Brother (2 Years)

9 years ownership - servicing, new tyres and a battery and not a single thing go wrong.

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4 minutes ago, Kurt Barlow said:

I owned a Toyota Avensis for 4 years which I sold to my Dad (3 years) who sold it to my Brother (2 Years)

9 years ownership - servicing, new tyres and a battery and not a single thing go wrong.

I wouldn't touch a Toyota, too unreliable :D

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1 minute ago, Kurt Barlow said:

Irrespective of what Joe Public thinks the surveys posted by Ah - So suggest otherwise.

People are free to chose whatever they want. The point is though that German reliability does not always stack up when compared against other countries vehicle marques.

And surveys and reviews are open to everyone else with internet connection who bothers to do any research before making a major car buying decision.

And I respect their choices.

Individuals have their minds.  They can test drive.  They can do their own research.  

It's their money/their debt obligation, and with cars, finance companies take some risk as well.  And there actually is another option, with buying an older car, with a bit of saving and no debt at all, but possibly higher maintenance costs.

3 minutes ago, Kurt Barlow said:

I owned a Toyota Avensis for 4 years which I sold to my Dad (3 years) who sold it to my Brother (2 Years)

9 years ownership - servicing, new tyres and a battery and not a single thing go wrong.

Way back I was warm on the Toyota Avensis for quite some time, but made a different choice.

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1 hour ago, regprentice said:

I think the 'premium' brands manage to paint running and servicing costs as part of the mystique of keeping a premium machine running optimally. As if they are so special that without the constant and gentle fondling of a 150 quid an hour mechanic the car would simply wither away and die.

Japanese cars are different but i saw the same mentailty in a company director who had bought a impreza wrx sti. Told everyone how special the car was that it needed 3 services by 10k miles, including being taken back at 1k to check it was 'settling in properly'.

Subsequent owners buy the cachet but may not feel the same about servicing costs etc. My sister in law has this problem...shes just remortgaged as her 12 yo 3 series threw a £3k Garage bill. No idea whether shes repairing the old one (a poverty 320d) or buying another.

Im a big fan of the smoker barges 1-5k thread on pistonheads. Loads of great 30-100k cars being discussed that can mow be had for 'pennies'. But. Some of the ownership/cost experiences shared on the forum are eye watering!

On the smoker barges point - I was really tempted to buy a Phaeton, until I found out that lightbulbs are main dealer job. Mate of mine bought a second hand Aston Martin, cost him a 5 figure sum in the first year.

If you can't afford to buy it first hand, you can't afford to run it second hand.

Edited by frozen_out

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Spoke to a friend in the motor trade, he's just renewed his 3 yr vw polo lease for his vat registered biz.

The base model sells outright for £12k (10k - vat ) 

http://www.volkswagen.co.uk/new/polo-gp/home 

He said to VW he wanted the same deal as before. £125 a month inc vat , 8k miles a yr 

Downpayment was £805 inc vat so £670.83 plus vat, he can claim all the vat back including on the payments

 

http://www.theaa.com/car-buying/depreciation

Quote

. The average new car will have a residual value of around 40% of its new price after three years (assuming 10,000 miles/year) or in other words will have lost around 60% of its value at an average of 20% per year.

So car has lost £7.2 k of value after 3 yrs . Value £4.8k 

 

vw have got back

 

3 yrs lease                               £3600 (vat removed)

Deposit                                     £  805

Total                                          £4405

Minus Depreciation loss (60%) £6000 

                       loss                    -£1595

 

so what sort of profit margin are vw making to off set that loss ?

 

 

 

Edited by Saving For a Space Ship

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On 20/04/2017 at 6:23 PM, Ah-so said:

The reliability of German cars is a myth they still profit from without having to produce the goods. None of the reliability surveys have German manufacturers at the top. 

http://www.autoexpress.co.uk/car-news/consumer-news/91220/the-most-and-least-reliable-car-manufacturers-2016

http://www.whatcar.com/news/skoda-tops-new-uk-vehicle-dependability-survey/

 

More Manufacturer ratings here http://www.reliabilityindex.com/manufacturer

Top 100 cars with average repair costs http://www.reliabilityindex.com/top-100

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1 hour ago, Democorruptcy said:

More Manufacturer ratings here http://www.reliabilityindex.com/manufacturer

Top 100 cars with average repair costs http://www.reliabilityindex.com/top-100

Mercedes, BMW and Audi now have terrible reliability ratings, but they continue to dine out on a reputation built decades ago.

I am particularly pleased that Land Rover is even worse, however - about the least reliable car going.

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I don't care if people do stupid things with their money, i don't like it when the media perpetuate the myth.

The bankers rip us of for loans and then use it to buy prestige German cars.

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