Help me spend my money...

[DrEskimo]

So somebody - presumably the lease company - is losing out this way. It amazes me that a company will effectively take a bath on a deal that they know will lose themselves money. I'm not trying to be smart but I am just surprised.

Yup....some companies will do it unknowingly. My father in law had a Nissan Leaf on a PCP and the GFV after 2 yrs was £12k. When he came to trade it in, the best price he could get was £7k....!

Needless to say he just handed it back and let the finance company take the hit. This is why people are worried about the large use of PCP and the potential that there will be a huge amount of finance owning on assets that are worth far less. Basically exactly what happened in 2008 with sub-prime mortgages....Probably likely to start with diesels if they drop in value in response to all the news around them...

For leases, I imagine it might be a bulk saving thing. Or maybe selling them at a loss is better than not selling them at all...? No idea I'm not a business man...!

 

[Flying Scotsman]

For those who are interested on merits of lease, finance, PCP
Here are Canadian rates for lease...finance ...select ( select is a type of PCP ) on a very nicely equipped S3, leather, pano, BE, Stronic, SS seats etc....
Lease is rated on 2 years and 25,000km per year...Finance and Select are 4 years and no KM
No deposits on any and 3.9% interest on all
Costs at bottom are Lease..Finance..Select.
ALL FIGURES ARE CANADIAN to convert to sterling multiply by o.6


2018 Audi S3 Sedan
2.0 TFSI S Tronic Progressiv
MSRP: $ 46,900.00
Optional equipment: $ 3,600.00

Total MSRP1: $ 50,500.00
Compare your financing options:
Lease Finance Audi Select
Term: 24 Months 48 Months 48 Months
Interest rate: 3.90% 3.90% 3.90%
KM (per year): Lease only
Low KM savings 25,000 km
Down Payment: NONE
Trade-in value: NONE
Look up est. value
Est. payment: $1,010.69 $1,244.45 $940.16
(monthly incl. tax)

 

[glospete]

The images didn't appear - just exclamation marks.


Sent from my iPad using Tapatalk

 

[Flying Scotsman]

@glospete or others... are you referring to my post, as I can see them. Maybe Audi Canada has a block on use outside Canada. Let me know and I will type in the
figures.

 

[DrEskimo]

@glospete or others... are you referring to my post, as I can see them. Maybe Audi Canada has a block on use outside Canada. Let me know and I will type in the
figures.

I can see the figures.

What is the ballon payment set to on the Audi Select finance?

 

[Flying Scotsman]

Balloon payment for monthly shown,which is only applicable on Audi Select is $14,698.50 based at 30% That percentage can be adjusted and will affect monthly payments eg 36% = $17,638.00 monthly= $879.31

 

[DrEskimo]

Balloon payment for monthly shown,which is only applicable on Audi Select is $14,698.50 based at 30% That percentage can be adjusted and will affect monthly payments eg 36% = $17,638.00 monthly= $879.31

Something isn't adding up here....

Finance = $1244.45 * 48 = $59,733.6
Select = $940.16 *47 = $44,187.52 + $14,698 = $58,885.52

How can the Select finance with a balloon payment be costing you less than a straight finance agreement?

....what am I missing??

 

[Flying Scotsman]

You have to add 7% tax to balloon payment and term is x 48

 

[DrEskimo]

You have to add 7% tax to balloon payment and term is x 48

Ah right...forgot you guys over the pond never actually give the true price and you have to work out tax after...! (although I would take that and just a 7% tax rate over our 20% tax rate...!!)

Also a UK PCP over 48months would mean 47monthly payments, where the 48th payment is the balloon payment.

So it's

(940.16*48)+(14698*1.07) = $60,854.54

Still not as much as I would expect...so guess I'm missing something else

 

[DrEskimo]

As a comparison:

PCP on RS3 Saloon:
RRP: £45,250
Deposit: £5,000 (cant do zero deposit)
Interest: 6%
Term: 48m
47 monthlies of £520.92
Balloon: £23,259.8
Total: £52,753.04

Straight finance using loan:
RRP: £45,250
Deposit: £5,000 (for comparison)
Interest: 6% (for comparison)
Term: 48m
48 monthlies of £1,221.59
Total: £48,977.11

The you consider you can probably get much better rate than 6% on personal loan, around 3.9%, so monthlies are £1,185.33 and total cost is £47,672.03.

As you can see, PCP is as much as £5,000 more expensive...! But monthly cost is much lower, over half.

 

[Flying Scotsman]

Doc, it is not a true PCP and Audi Finance as you can see offer very good interest rates, some models get as low as 0% at about this time of the year. North America is a very competitive place to operate in the auto business. as you can see from the list price I show for an S3. Plus we are left hand drive which I am sure also makes a difference.

 

[Jassyo06]

Doc, it is not a true PCP and Audi Finance as you can see offer very good interest rates, some models get as low as 0% at about this time of the year. North America is a very competitive place to operate in the auto business. as you can see from the list price I show for an S3. Plus we are left hand drive which I am sure also makes a difference.

Ever since l can remember the American markets has always been cheaper for everything whether it be white or brown goods or cars, vast population means they can sell more product and more variations and as you say more its a more competitive market also most Americans still have the made in the USA Mentality as far as cars go

 

[Audi Bairn]

Ever since l can remember the American markets has always been cheaper for everything............

Everything except Lynx Shower Gel (or Axe, as they call it). Costs a ****** fortune over there