Couple of reasons why I haven't sold my cars privately for years. 1) I have always cash bought my cars and would therefore have always relied upon the trade in of my old car to make sure I'm not without a car at point of sale. 2) My traded in cars still have decent value of 20k ish so avoids depleting savings more for the new car until you can sell the old one that you then also have to insure etc at the same time as new one. 3) I privately sold my very first car. The person who bought it nearly killed me on the test drive twice and damaged wheel by smacking a kerb which was a scary experience. 4) I've since owned performance cars and the last time a sold privately I discovered most people don't spend a decent amount of money on 2nd hand cars bought from someone's driveway without warranties from a dealer etc and what you get is idiots turning up who just want to rag your car. No thanks. Do you not think that the value is going to drop a decent amount on model 3 in next few years as competition gets there, more cars become available and Tesla cut prices like they did with the model S or they make updates to hardware that earlier models miss out on making them a bit obsolete? I think people still tend to view electric cars like their mobile phones so they just buy new and finance as they don't want to be stuck with it years down the line. I worry you might be being a little optimistic with your value expectations at the end of your PCP.
I leased my 2018 hyundai Ioniq because I don't think many people will want to buy a 4 year old 130 mile range ev in a couple of years time. I didn't want to struggle to get rid of it.
3 years from now the economy will look very different to even one month ago. Keep your options open at the moment, don't commit if you don't have to while things are like this. I predict a lot pcp and lease deals being defaulted on in the next year or two, so a market surplus with fewer buyers wanting to enter into multi year deals.
I bought my i3 on PCP 4.9%. After six months I took out a personal loan from Tesco bank - 2.9% and cleared the PCP. So the car is now mine and has a clear HPI check. Although the interest rate is lower, my monthly payments are slightly more (talking £7.34 more), this because I no longer have the balloon payment hanging over me.
My first brand new car will be an e-Niro via a salary sacrifice lease. It's a no brainer - the very cheapest private lease I could find would've been £19k over 3 years including insurance, tyres, breakdown cover, servicing and tax. The only PCP deals I can find are more expensive. I'll be paying £13k. Normally I'd buy a 1-2 year old car that's still in warranty but significantly cheaper than a brand new one, but given the rapidly changing nature of the EV market and the amazing deal I can get, a lease makes the most sense for me right now.
Thank you for creating the very useful video. Please could you create a part II, which looks at buying the car outright and keeping it for 5 years. PCP versus a Bank loan over a five year period. The manner in which you present the material is simply fantastic - a natural !
Hi, once again great video. Just to add some insights regarding the financing of an EV (and vehicules in general), dont forget that leases or PCP are getting less and less interesting moneywise as your mileage increases. For my part, I have to drive a bit north of 30 thousand km per year (around 18K miles for non SI fluent readers). The monthly payment for a lease or PCP (they were very close) were around 650 euros/month for a 5 year contract, and I would still have to pay about 22k € to keep the car at the end in the PCP proposal. I bought my LR model 3 by financing it through a bank loan on 7 years as I could keep the monthly payment below 600, and be able to sell the car if and when I see fit. All in all a better deal and less constraints. Several banks in europe (I now French, belgian and Spanish banks for sure do) have special loan offers for green vehicules (EV/PHEV) with very low interest rates (think less than 1.5%... sometimes even less) so if your mileage is high, do consider going for a "classic" bank loan as it can get cheaper this way.
@@ElectricVehicleMan sure but in this case the balloon (last payment) is going to go up (basically you always pay the same amount, the mileage is just going to shift the price on the monthly payment or on the balloon). If you intend to keep the vehicule then you're better off going for a traditionnal loan as the interset rates are going to be lower. That said, PCP/lease remain very interesting if you don't intend to keep it and know (or bet) on being able to ressell the car for a good price at the end of the lease and pay the financing company with that money, I agree. I actually looked into that but got cold feet in the end and choose a more traditionnal way (first EV AND first new car buy so...)
Once you realise there is no actual benefit from having the GFV, you then realise PCP is just an extraordinarily expensive way to borrow money to pay for a new car... I just can't fathom the idea of paying over £4k (in your example) in interest to a finance company for absolutely no benefit. I simply wait and build the cash first, or if I am very impatient then I borrow as little as possible for as cheap as possible (lowest APR, overpay, shortest term, etc.). If monthly budget is the main driving factor for choosing PCP, then simply wait and save up more so you borrow less from a personal loan and get to the same monthly cost that way. The less you borrow, the cheaper it gets.
In my life i have always purchased a car by getting a good rate bank loan, then the car is mine from day one, pay it off in 3 years and sell it and the full price is mine to do what i want, handy if for instance you lost your job sell car and you have a wad of cash to survive with, I have always thought that a lease or cpc is an expensive way to go.
I've done cash, bank loan and car finance. The problem is, the cheapest option can change every time you look. Sometimes with PCP you effectively have a loan of a smaller amount (predicted depreciation, rather than total value of car), so even with a higher apr, the monthly cost can be lower. You also come up against manufacturer and dealer incentives - last time I took a finance deal, the dealer and manufacturer "deposit contributions" were more than the interest over 3 years, so I ended up taking finance, even though I had cash to buy. A spreadsheet is the way forward!
With PCP I like the option in the background to have a 50% break out clause or voluntary termination as a safety if things go pear shaped without issue to credit rating. Also my PCP provider allows a sale at this point if required. On hire your in to the end as I understand it or pay all remaining payments to exit early.
It’s the huge depreciation that has always put me off having a new car. I’ve done it twice in 40+ years of driving and lost loads of cash on both occasions. I appreciate electric cars, at the moment, don’t depreciate so much, but a friend of mine works at a university that is working with a “major manufacturer”, (they can’t say which one!), and he has advised me that we will see a huge change in electric drive vehicles within the next 2 years, and has said “Don’t buy a battery car new now - it will be “old hat” in three years”. The only clue he could give is that it doesn’t involve battery development. (Sorry if that upsets you, but the Tesla 3 is without doubt the best ev at the moment)
Your friend is right that car batteries are in early phase and big changes are coming but he is wrong on time scale any it's like computer you can always weight 6 months and get a much better one
Watching this 2 years later and I agree with you. The prices of used Tesla model 3's on autotrader are way above 30000 pounds. The lowest I have seen is 36k for a 2019 model with about 40k miles. Performance models are as high as 48k.
Depending on the actual apr on PCP it is probably cheaper to get a longer term loan and pay cash and then after 3 years sell and pay the loan off. You're bound to get a lower apr with a bank (least with other dealers)
Tesla is 4.9% as an example at the moment. High value personal loans are around 6%. If you can keep it below £25k you’d get around 3% so that’d be worth doing if you can put more deposit in or buy a less expensive car :)
@@MrKlawUK If you're in Scotland you can get £35K from the government (energy saving trust) on 0% for up to 6 years towards a new electric car. You can even do a personal loan for the rest which would be under £10K for a Standard Range plus model 3 (just not a regular car loan - as there isn't the option for the bank to own the car if you don't pay the loan back). In that circumstance, so long as you have a decent enough credit rating to qualify for the loan, PCP makes no sense in Scotland on a Tesla.
did this with my used LEAF, borrowed £7k at 3%. cheaper than car finance PCP etc... can always sell the car whenever I want and pay off the loan if it came to it.
I'm across the pond and really like your videos. When you run out of car-related things to do, I absolutely like seeing you take the car around town and on trips...I like to see where you live and what it's like where you are (no, I'm not a creep). Take a short weekend trip to a resort nearby, picnic or something, overnight maybe, and take video. I suggest you organize an electric car club (if you haven't already) or organize a Cars & Coffee in your town.
I’m a Yorkshire man too, best way to buy a car is to get an mot failure and fix it yourself, run it for a year and sell it with a new mot. I ran cars for years with no depreciation whatsoever. By far the cheapest way to go. Now, as for videos, set up sentry mode, and explain how it is done. Then show the new software, to see the footage. Also, you could go through all of the options on the Tesla screen.
If you can carry the risk of vehicle depriciation vs. the ballon payment lurking towards the end, go PCP, its cheaper. But if you aren't able to deal with the risk (in case car is less worth than the last payment), leasing is more expensive but also more secure. As usual, you pay for someone else to carry the risk. Just like getting an insurance (or rather getting an insurance with a smaller deductible).
Never leased electric. Always bought cash or loan. Not a fan of leasing. Makes sense as a business owner and to write off the lease as a tax deduction, but that is a very short term thought. Your same points about a loan apply there as well. The guarantee of turning in the car is the only upside....
Very clearly explained, and you're right that GFV is usually 10-20% below the actual future value* so that's a bonus to factor in. Only thing I'd highlight is the 35 months where on a PCP you'd be forking our best part of £600 as opposed to near as dammit £500 on a lease. For a lot of people that's a negative for PCP. But yes overall you'd be better off. *I think you're being a little over optimistic on your Tesla's selling price but we're both crystal ball gazing!
It's all about total cost of ownership over the period you intend to own the car. I came to the realisation that I was losing a lot of money on buying and selling cars every 2-3 years. I created a spreadsheet that covers all the costs and residual value (if any). Turns out it's cheaper for me to lease an E-Tron over two, three, or four year periods than it is for me to buy a Model 3 on PCP and keep it for the same time.
Great content, I was in two minds which way to go just now for an eNiro, went PCP (think I went right!!!!!) see in 3 years. Glad I have found your channel its helped me so much getting to grips with my new car.
PCP was brought in to boost sales and get people to overstretch their budget on cars they wouldn’t otherwise be able to afford.. Was and is a win:win for dealers. ( lose:lose for us!). You are also tied into servicing at main dealer with the stupid costs included! Tesla doesn’t need servicing.Finance is costly but you do own the car at the end. Bank loans are possibly cheaper now! Great vid thanks.
Over a year on, the cheapest clean 3yr old model 3 on Autotrader is £35k, costing around £37k new, that is roughly 95% after 3 years. The leasing costs on M3's has risen, partly due to the government funding loss on the M3, total being (currently) £23,552, @ purchase price of £40,990, that is ~57.5% of MSRP, anything over 35% on a 3 year lease is overpaying. PCP is £28,220, with £16,806 balloon. If the current market was to remain, then after 3 yrs would be £38,940, @ £45,026 for the total cost of the PCP as a lease would be £6,086 over the 3 years (If you paid the balloon and sold). Or you would be better off to the tune of £17,466 If the retention becomes 65%, cost is £18,382.5, or £5,169.5 better off. This isn't true for all cars, but a regular fossil car in 2-3 years are going to start depreciating like a stone.
It's a different life for me. I bought my 54 plate Renault Grand Espace 7 years ago for £2500. It's done me well, although it cost me a few front tyres until I found out the spring was snapped. Now it needs a new Cam-belt, the heater, a window, CD player don't work and it isn't worth keeping running. I can only dream of spending £20k on a car over 3 years, it's a different life.
All you say has to make sense for a private buyer or the lease company would be loosing out. I know they probably buy at a lower price than a private buyer but even so. Of course when it’s a company it’s better to lease because they can claim the total deposit and monthly payments against tax, they can’t do that with a purchase car, then only a portion of the weekly cost can be written against tax. There is, just to muddy the water’s, another kind and that’s lease purchase! This is similar to lease but the monthly payments are larger and the final monthly payment is the purchase. I use to use this method of buying for my works van.
Good and thought provoking video. You used the word if and the phrase "it's nevver going to" a lot. Food for thought. 4 months ago i probably had £250000 equity in my property. Today? Throughout the past 30/40 years and the technology boom old and used electronic tech has without exception decreased in value as new tech comes along.
I think the interest rate is important to look at carefully and cost overall before resale. The best thing with a Tesla is the fact now even the lowest range car is good enough combined with the charging network to never worry about resale value.
The funny thing is right now, the *cheapest* used model 3 available on autotrader is £38,000! That’s a 2 year old car with 30,000 miles. So in the current market you would be way better off on a pcp. Good explanation 👍
On direct financials leasing might come off the worst although not necessarily. Obviously makes a difference if you can offset the VAT (self-employed.) But leasing very convenient and a new vehicle every three years without having to worry about it getting rid of the old one.
Me myself I love cars and love driving but hate all the paperwork around it. I've been leasing ever since private lease became a thing. I know I pay a bit more but I gladly pay for the service.
Thanks for that video. I always am wondering why so many people are advertising privat leasings so much. Because it sounds like you have to pay less for a car then if you would buy it with any sort of credit. But why would a bank or a car manufacturer give it to you for less money. But to sum it up: Leasing: After the 3 years you have nothing when you leased a car but paid ~50 % of the cars value, but because you need a car normaly, you somehow have to either get a new leasing contract or take a credit, but as mentioned before you paid a lot of money the last years that is now gone. Credit: You have to pay more, overall you basically have to pay the whole car to the manufacturer and the bank that lends you the debt plus the interest, but after that you have a car, that you can either keep using, or just sell it and get a new car. But in both cases you still have something (a car or a proportion of the money to buy a new car, or something else if you think you no longer need a car)
I have my SR+ on PCP, if it doesn't give me any major problems then i'll be buying at the end, being a key worker i get to drive it every day too - I can let you know what it's like if you want ;-)
Over the last 20 years - running a VW dealership -I have noticed more and more PCP deals, even with ICE vehicles it is better value (on German brands). I t is the balloon payment, and it works on residual value, non-German tend to be worth less than final payment. I have seen same customer start with a Polo, and has moved up to Tiguan through a Golf then CC, so I can confirm PCP works. Leasing is really just for self-employed to write off tax. Another downside to lease is if you have scratches or car park dings, they charge like a wounded buffalo for these (and then sell car at Auction with damage), or go over your mileage. Lease is usually 8,000 per annum, with £0.06 + VAT per mile over that.
Interesting difference. The PCP is a form of typical lease here in the US. One thing you did not mention is what kind of penalty you are assessed if you exceed the agreed upon mileage. Here the additional cost per mile over the lease agreement is quite expensive and often forces the out right purchase of the car at lease end.
I've leased for more than a decade - so I've dropped the emotional attachment, and (usually) swap every 2 years. I usually pay 3 or 6 months as the initial payment, and look for a deal. Currently have a Golf GTE for £237/m inc VAT (was 6+23 deal, but due to lockdown will end up being 6+29). No emotional attachment and absolute clarity on costs - plus no need to sell, or finance a deposit.
I've just ordered a new DS3 crossback on lease won't get it till things lift with the lockdown but it is way cheaper for me and got a bargain Prestige model, petrol so cheaper for me as current is a diesel. 24month lease I chose 8k miles a year as in the last 3 years of having current car I've maybe done 15k or a bit less so 8k is plenty paid £1.500 upfront (they take it when it's shipped) all for £147 a month No tax to pay, no MOT being a new car don't need one if have it under 3 years, no servicing with the miles I'll be doing and at max I'd have to replace maybe 1 or 2 tyres while I have it. Insurance is cheaper too as I get full breakdown cover so I don't need to add it to my insurance. And they waived the £199 processing fee. I've been pondering for ages and it's just the best for me and cheapest way too do it. I'd love a i3 even a used 2015 rex but way too expensive on PCP for a half decent model I've found on PCP they charge alot more a month with a smaller chunk at the end if you keep it where as petrol and diesel cars you get cheaper monthly payments and a massive chunk at the end which is what needs to happen with EVs instead of being more each month, that and insurance for any EV for me is £100+ a month :/
I think it all depends on how long you keep your car. Leasing is probably a better option if you change your cars every 3 years. But if you get a car that you love, then PCP would be a better option. In 2018 I bought a new Ioniq for £22,500. 18 months later my second pension matured and I was able to afford a Kona. I got £19,000 for the Ioniq and I will be keeping the Kona for a long, long time as it suits all my requirements and is a brilliant car.
Its interesting how the market (and the vehicle purchase terms) are different in the US. Here, Tesla aside, they struggle to sell any electric cars. I live in a metro area on the west coast where the charging infrastructure is reasonably well developed, and nobody in their right mind pays full price for any EV around here because they don't sell. I bought a 19 Bolt at the end of last year and got $15,000 off ($43k premier model, purchased for $28k) with zero negotiation. Less than $4000 of that was government paid, almost all of it was cash discount from Chevy. I chose to buy it rather than lease because they were offering a better deal to purchase. Just before lockdown here in the US, I leased a Kona EV. Hyundai still has their full credits from the government here, so that's $10k off right off the bat, but the dealer offered another $3k in discounts on top of that as well as leasing the vehicle to us with no additional mark-up on the lease terms itself. They also threw in $500 worth of paint protection (clear bra) that they had already installed for free. Again, no negotiation. Both cars have production dates more than 6 months prior to the purchase date, so they had been sitting around for a while. Also, at least as far as I'm aware, in the US you have the option to purchase any leased vehicle at any time during the lease. You could lease it for a month and then buy it if you wanted to. Or you purchase it outright an finance the entire value of the vehicle (or pay cash I suppose). On another note, I do have an attachment to my cars, including cheap/stupid ones that I shouldn't be attached to. The odd thing is that, between the Bolt and the Kona, despite the fact that the Kona is a better car in terms of comfort, technology, and even things like charging speed, I like the Bolt more. I've never been able to identify why, but your comment on not getting attached to leased cars makes me wonder if that is it. Also, although I think the terms of the "lock down" are different here in the US, I work as an essential worker (automotive technician) so I'm still driving every day. The massive reduction in traffic actually makes my life a lot easier, although it has substantially reduced the amount of cars that need fixed and really hurt the industry I work in. We also aren't really strictly locked into our houses, for better or for worse.
I am currently saving for an electric car (I shall also need a loan!) It is between the Model 3 and the ID.3. I have concerns about each car and I lean towards the Tesla. I would caution you about the valuation of your car in 3 years time. Prices of the model 3 second hand are high at the moment as there are few about. In 3 years time there should be plenty around. I do think they will hold their price better than the model S. My concerns about Tesla relate to the constant changing of peripherals around the car. I seem to think the standard range was £42,500 a few days ago now it is £40,490.This is just one example of changes - Bjorn is not happy about changes that have happened around the use of the referral program (video on UA-cam). If the VW ID.3 is as cheap as it has been hinted the Tesla may slash the model 3 price again (who knows?). I did a bit of tyre kicking in both the Kia and Hyundai dealer which convinced me that their cars were not for me. There is no problem with Tesla dealers as there aren't any! Tesla Birmingham are not too far away (about 30 miles) and they have a van based service so that should be ok.
I’m also a Yorkshireman, £500/600pm for a car? Forget it, and the £4.5k deposit. For the price of the deposit I could buy a decent runabout a year for 5/6 years. Less if one passes it’s MOT.
I fully agree with your assumptions at this point in time . I would like to point out depreciation will be in issue in possibly five years maybe as much as ten years time ( demand and supply should equalise by then) but certainly not before that. I think PCP should be cheaper and it is far better if you need to terminate the contract early.
I would have thought that the next topic was obvious. The total collapse in sales of internal combustion engine cars, whilst electric car increased during the shutdown. Hybrids were also down showing that people are not buying the 'self charging' concept.
Can’t really predict how much the depreciation will be because it will totally depend on how the technology and options change. With ICE cars it’s very easy to predict what the depreciation will be because the technology hardly changes over time
I tend to look for the cheapest way of purchasing. With my current EV it was cheaper to get a bank loan. In the past when interest rates were high it was cheaper to get a deal via the dealer. Many dealers were offering way under 5% APR and the bank rate was at least 8%
Manufacturers generally would prefer leasing , Tesla at present may likely prefer you to buy as money comes in sooner . Leasing just rental unless you buy out at the end which for Tesla was not available in USA but maybe available in uk . Rental never makes economic sense unless you want to have new product constantly which is not economic sense
I went with a PCP deal on an e golf. They were offering 0% apr so instead of buying it outright (which I’d normally do) I jumped on a free loan 😉👍. One thing thou, I did trade my car in as I need to get to work and can’t go without it for a few weeks in between sales, or have both and insure both whilst getting rid of it. Plus it was a diesel and making weird noises - so I was glad to see it traded in. Value was reasonable too. Would love a Tesla - I’ll tap you up in 3 years 😉
I am investigating this very scenario on a model 3 . I bought my last electric car and sold it after 5 years due to work abroad. The tech change in EV in that time was huge.This has made me question buying an electric car outright ever again.I am leaning towards a PCP just as a way of affordability. Is it not possible to put the car ( Guaranteed minimum value) towards a different car (or even a new Tesla) in 3 years time on a new PCP as technology advances and other competitors will be around to greatly reduce your estimated 3 yr residual value. I think you would be lucky to get anywhere near 28k in 3 years.
@Alex de la Mare Norris Right now the used car market is so distorted. Used EV market even worse. The gamble is in 3 years will the demand and supply be the same as it is now? Who knows. If supply increases then new and used values will fall, but if demand stays as it is now (way above supply) values will hold similar to what you’ve shown. It’s all a gamble.
Worth mentioning that if you live in Scotland you are entitled to apply for an interest free loan up to 35k over six years if you are buying a new EV. The scheme is about to be extended to used EV,s where the limit will be 20k. Loans are provided by transport Scotland.
I've just been approved for an interest free loan under this scheme. So, for a new MG5 Exclusive it works out as around £310 per month over 72 months. The application process was pretty easy. Car dealerships don't tend to mention this scheme as they obviously don't make any money from it but it's a good scheme, especially now that it's been extended to used EVs as well, but there is only a limited pot of money available each financial year.
You ask for ideas for future episodes and I would love to hear from your wife about her experience driving (your) family Tesla. She said she had range and charging issues with the Leaf so It would be good to learn what has changed... if anything. I wouod also enjoy hearing from her about tge way you kept it a secret. Also pass on at least this viewer's thanks for the work she is doing.
I note that Tesla were selling their demo M3’s for £34500 on their website last week with about 8-10K miles; a few months (9?) old. It will be interesting to see where 3 year 2nd hand values land...
Hi there... I'm seriously interested in getting an ev so your video on pcp or lease was very useful. As far as topics for new videos what about evs and solar panels. I have solar panels and I think i can reduce my cost significantly during the summer months although I live just south of Belfast lol and we have much rain here but fab presently. I just love the idea of plugging the car into the sun essentially and getting free charging in the summer...hope you can do something on this topic..Johnathan... belfast
The thinig with solar panels is that you need to expect to be in the same house for at least 10 years to really maximise the benefit. They cost a lot up front and only really cover their cost after 10+ years (depends on your usage and weather), but it's definitely something to think about, especially if you pair it with a battery (eg Tesla's PowerWall).
Just traded in my 2018 Renault Zoe Sig Nav battery leased for an e208 GT Line (after 2 years of 3 PCP). I was given more for the Zoe than I paid for it 2 years ago which (when taking out a low balloon payment) gave me a £6500 deposit for the e208. Good times
I have my SR+ as a lease but for a company car over 4 years. The zoe GT50(winter pack, rapid charge, metallic paint) I have on order is PCP, 7k down and 260 a month 4 years. With final payment of 11.5k. Think it will be worth much more but will probably keep for another 4 years anyway then it can be my eldest first car. We looked at leasing but PCP seemed better all round.
I've had both PCP and Lease, There are 2 factors to think about when doing PCP, 9/10 your car will be in negative equity at the end of your term, so to swap it for another vehicle, your pumping more money into a new deal. Secondly if you attempt to sell your car privately, alot of people are very cautious about buying cars with outstanding finance, also selling cars privately can be a headache and can take time....especially in the new up and coming financial climate we are entering. Lease...okay it's never yours, but neither is PCP until you pay that final balloon payment, but with lease you know where you stand and if you're okay with more or less renting a new car for your contract term....there's no issues.
I’m sorry but 9/10 you’ll be in negative equity? That is way off. It’s the other way around. If it was negative then people would just hand it back and manufacturers lose money, which rarely happen.
@@ElectricVehicleMan ....it all depends on the manufacturer. That's why some lease deals are way cheaper than other lease deals, because the residual is much better on some cars than others. But let's face it....the consumer never wins when buying cars, leasing, pcp or hp!
I feel silly now buying my automatic Vauxhall omega 2.6 CDs with 50,000 miles on the clock for £700 admittedly the Road tax is ~ £400/year and I have normally to buy another car every two years. I normally get £200 scrap value for the cars when I get rid of them because I cannot be bothered to resell them. I love being able to drive a car without worrying about keeping it clean and scratch/dent free. They are getting difficult to get hold of now because the last ones made were in 2003. I do not want to go to a Vauxhall Insignia
The one thing that really puts me off leasing is the limit on mileage per year. Pretty much all lease deals I've seen for EVs put a cap at 5000 miles per year, which, according to my crude calculations, wouldn't even cover my daily commute (or wouldn't have before the lockdown). My workplace isn't even that far away. It seems to me that leasing is really meant more for "secondary" vehicles that you would only use occasionally, maybe for the odd long journey. Unless you're prepared to pay up for the excess mileage that is but that doesn't make it cheaper.
Research better. There are lease co's out there that will do 100K+ on EV's. Most internet brokers are kids in their parents bedroom offering a deal from another provider. Go direct to the source. Major lease co's will be fine with higher mileages.
Most people are unwilling to keep a car for that long. We're creatures that are easily bored. Plus the longer you keep a car, the higher your expenses.
@@marklola12 Obviously it won't have much value at 10 years, but it will have saved you more than any other method, so the 'lost' money should be in your bank. They do go 'out of date' in terms of fashion, and with older models, range, but you can replace the batteries after 10 years if you want and more new EVs now have enough range to keep most people happy. From my viewpoint I'd say keeping it is a pretty good bet, and anyone who says it looks old may be impressed by the cost of 10 years driving.
Many leases let you buy the car at the end too. Our e-Golf is through VWFS and it says we can ask for a quote within the last 3mo.. I'm hoping the expected value crashes just before then so I can keep hold of it at a bargain price 😁 When I compared many PCPs and leases last time around, the lease was always cheaper (assuming handing it back and/or that the PCP final payment is a fair estimate of the value will be). One of the dealers told me it's because the PCP has to build in some to cover the consumer protections you get with the PCP that you don't get with a lease (it's easier to get out of a PCP if your circumstances change, for ex.).
Thanks EVM, it's always good to have payment options compared like this. Of course, it's always going to be cheaper to pay cash for the car upfront rather than any form of borrowing but that just isn't an option for everyone. Idea for lockdown episode? Specifically for Model 3 interest (apologies to other EVs), can you look at dimensions that aren't easily available online? Things like, how long it is from the front to the A and B pillars and how much room you need if parked in a typical garage. I've ordered a TM3 (on lease!?!) and I've had to make some alterations to my garage to accomodate parking/charging etc. I had to make an educated guess at how much room I'll actually need in order to get the drivers door open, walk around and plug it in as although length, width and height and wheel base figures are easily found, something more practical like how far the doors open is tricky to find on Google. I just hope I've estimated enough! Just an idea but no-one else has done one as far as I can tell. Keep up the good work mate.
Thanks for this info. I'm currently in a PCP deal with a diesel Kia. In my scenario I actually do think that I'll be just handing back based on the fact that diesel is dead. I actually assumed that to be the case when I took out the deal 3 years ago, so I'll give with that. But I'm certainly getting my next car on PCP, and it will be a Tesla M3, probably your exact spec.
In my mind an important part of the Tesla experience is being able to purchase the FSD or boost upgrades if you require them after receiving the car. Prospective Leaser's BEWARE I have also recently leased a Model 3 Long Range and have been told by LEX AUTOLEASE that I am not allowed to upgrade the car. They didnt tell me this before signing on the dotted line.
I haven't seen a review of the model 3 camper yet. You could have a lovely drive out on to your driveway and sleep under the stars (for 5 minutes). Put a green screen up and have a virtual road trip across Europe.
The car manufacturer has no interest once a car is sold or leased. It all goes to a finance arm either owned by the car company (this is where the real money is made) or the leasing agent or your lender . The lease company gets the car back at the end of the lease and obviously would like to break even on the sale of the car. (which is calculated in the lease payment) They sell wholesale so you should do better with a private sale. If it is a business expense that will change the calculation. Nice video. I bought a Niro EV and will see what it's worth in 3 years🤔🤔
I feel like leasing vs pcp is akin to renting a house vs a mortgage. When you renew your deal after 3 years, you've either built equity or made your landlord some profit
Interesting. I think you should have made it clear that it all depends on the actual deal, the car, and the annual mileage. PCH can be cheaper than PCPs and everyone should do their own calculations to decide which is better for them. In my personal experience, I got a nasty surprise in my PCP deal when after 3 years, I discovered that the balloon payment was much higher than what the car was worth. I had no option but to give the car back. A PCH would have been much cheaper.
With p/ex you will only get bottom book from any dealer no matter how many miles it has done and is perfect condition. You can try selling it privately but if you have a car that is worth quite a bit you will have no chance of selling for cash. Been there tried it just a lot of idiots wanting it for next to nothing.
Another subtlety I've discovered, is that the price of the car is sometimes cheaper if you're buying using a dealers PCP own finance, rather than say, paying cash.
I have an ICE car which is 12 years old, still in good condition. I have an EV on PCP right now & will keep it as at the end of the day I think it works out cheaper. As far as I can work out with my ICE car which was £23,000 new & apparently only £2,000 as px it is still cheaper than leasing & the same with the EV as even if I have to start paying road fund licence/ Road tax it will be still cheaper to keep at the end of the PCP period even if I have to get new battery pack after 8 years!! But it'll be more likely after 10 years & only those that have died.
I have a lease deal coming to an end on a Golf - they've offered me an opportunity to buy it so I never quite understand the 'no option to buy' at the end thing.
Most don’t but it is an option for some. However if the intention was to buy it then doing that in the first place usually is better as you’re not factoring in the lease company needing to make money into it.
I thought the car wasn't yours to sell until you pay the balloon payment? Until you've made the optional final payment to settle the PCP agreement, however, the car belongs to the lender, so you can’t simply advertise the vehicle and sell it whenever you like. This remains the case at the end of the agreement: until you have made the final "balloon" payment to buy the car, it’s not yours to sell.
I always think of it this way? Lease is like a company taking out PCP and letting you use the car over the 3 years. They wouldn’t do it for cheaper than you could do it yourself. Yes they can get some better deals on outright price but.....
Wrong mostly lol I have ordered a new DS3 crossback prestige on lease 24month 8k miles a year...I only have done 15k if that last 3 year so 8k is plenty £1.500 upfront and it's only £147 a month Everywhere else on lease is wanting over £200 and PCP new and PCP used is more than what a lease is It's the same for a few different cars I've looked at. Can get a new version Zoe the iconic one for £170 a month on lease
It's a no brainer, £3500 grant, future residual value (granted unknown) and the fact that dealers make more profit from second hand cars than new it has to be a cheaper option to PCP. Only down side is whether you can afford the monthly payments on the PCP, which are less on a Lease plan. In my experience if you like the idea of having a new car every 3 years or so then PCP may not be the cheapest way forward. If that isn't the case then ICE vehicles will have a worse residual value against an EV car I believe. It's all a matter of choices. I would be interested to see if there is any significant drain on the battery when it is standing. There is a video (somewhere) where the car is left for a period but I would appreciate your findings on this.
Interesting video. I done the same, yet to receive my Tesla, but my rationale is similar! However, Tesla actually offered me more for my Skoda than other dealerships (upwards of £2000 more). Private wouldn’t have gotten much more. I’d like to think Tesla are more keen, if that was the case I’d be hoping they’d offer more than others for their model 3 back at the end of the PCP! Overall, it seems like PCP is somewhat of a gamble. But it feels like it’s worth the risk for a Tesla Model 3 at this moment in time. Reminds me slightly of the stock markets, you could very easily end up coming out smelling of roses or not. It’s just the way the cookie crumbles!
Interesting video. Thanks for spending the time to explain. I’ve been trying to persuade the missus to get a mini electric on pcp. We’ve always purchased our cars outright in the past and have never used pcp. I did all the sums and calculated a saving of £120 per mont for a 100 mile a week commute. This included servicing and tax spread over the year. Problem is that we would be worse off monthly because I currently pay nothing for the car I own. I’d really love a mini electric to sit along side my other ICE car which would be used for longer journeys and hauling the kids around but trying to justify the monthly spend of pcp to my missus just didn’t work 😒
Not sure if this has been mentioned but with a Tesla model 3 there is £480 per year luxury car road tax to pay.( for cars over £40k). If you lease the car the lease company pays the tax, but it is down to you if you get a PCP deal. Worth factoring in your calculations.
I just had Tesla give me a trade in price for my 64kwh Kona Half bloody price , he said its because of the pox . i was going to ask him if the Tesla would be half price too. 18 k for a 35k car
Great video!👍 I think you need to factor In 3 years time Tesla will have serious competition and will need to improve both on price and specs, both of these massively effecting the price of the current Model 3, no way will it be worth £26k when you'll be able pick up somthing like a new id4 or Ev6 for near that?
The new battery day announcements could really hammer the predictions in this video? If the price of new entry level SR model 3 falls significantly in the next 12 months, which is likely, achieving even £22,000 is unlikely, buyers don’t care what you paid in 2020!
I predict that the Model 3 will retain much of it's freshness with Tesla's ability to totally reconfigure the touch screens software. The batteries technology will improve with age, but that will mostly let you have more power and range with fewer battery cells. It is very hard to predict, but the Model 3's body should retain much of it's style and newness. I am a person that loves technology and I've always gotten bored with my cars, but I keep them for several years out of economic necessity.
I’ve always bought cheap second hand cars, and mainly delivered them to the scrapyard when they started complaining too much. We bought our SR+ outright, cashing in a 20yr investment/saving policy. If we hadn’t have had the savings, we’d have gone the PCP route...or a loan of some sort. If Tesla’s are built with truck longevity, which they seem to be (at least the latter ones), then we hope it’ll last us 20/25 years. Good cars are part of the family to us, and it wouldn’t feel right leased.
Interesting video thanks. Been an EV driver for 6 years now... always PCP'd but this time I really wanted a Model 3 but when the time came to change they were still not released... so I opted for a short personal lease of a BMW i3 as a stop-gap. My next car WILL be the model 3!... but I had the same thought process as you as to whether to go back to PCP or stick with leasing going forward. I know its not the same thing but that huge initial payment is a bitter pill to swallow especially when you know you'll never see it again. When its a deposit on a PCP you know you'll get some of it back someday. I agree with your feelings on 'ownership' - the lease car just doesnt feel like its mine, or can ever be mine - therefore there is quite a weird detachment feeling driving it around. Also you are super paranoid about any minor scratch or stone chip knowing that the car will be forensically examined at the end of the lease and whatever the definition of 'reasonable wear and tear' being when the time comes. It does feel to me like PCP is the way to go for the reasons you've highlighted.
Two things... I'd rather buy a car that has been "owned" rather than leased for exactly the reasons you made over peoples attitude to the car if they know they've only got it on loan. So a PCP car should attract a higher price from anyone in the know. Also, if you lease a car and go over the mileage you agreed, you get stung sooooo much. With PCP, I believe it's your problem. Interesting vlog, and I agree generally about residual EV prices being better than ICE cars for the next few years due to availability.
Ronnie Lloyd every pcp deal I’ve had, has come with an excess mileage charge, per mile over what was stated upfront. My lease my new model 3 has exactly the same. Cost per each mile over. Obviously, the pcp one matters less if you decide to purchase it. But my lease deal has the same option to buy too.
I am a bit like you at the moment just got my KIA E-Nero 4 just before lockdown not even had to recharge it yet I must say great improvement on 1st edition. Ref PCP my last car was on PCP it was a C220 AMG LINE Estate one I wanted for years treated myself on 65 birthday after 3 years the balloon payment was about £3500 below what they were selling for so like you say all depends on what car you have. I was going to trade it in for the Nero but as usual the dealer offered me about £3000 below what I think it should be worth but Heh Ho then lock down came so if you know who wants a nice Merc Estate please let me Know. Another great video Regards Jim V
With leasing you are just perpetually paying hundreds per month for the rest of eternity and for what - just to have new shiny bauble every few years on the drive to show off to the Jones' down the road or the cleaner at work? Call me old fashioned, but I like to actually own the things I pay for whether it's via a loan or cash.
Thank you. Very interesting and it's nice to hear good figures and estimates from somebody who has investigated and knows the market - as opposed to some who'll just guess, pull figures off the tops of their heads or say something that makes it sound what they think the viewers want to hear. Have you done a side-by-side comparison of your two EVs yet? Not just range and handling but actually living day-to-day with the cars. Thank you once again.
another expence, when leased the lease company pays the road tax, which can add upto another grand or so, and i've not done a lease myself, but i've heard you can get the option to buy it at the end of the lease
Hmmm. I suspect you're right in the case of Tesla (premium brand, class-leading range etc), but I'm not convinced that other EVs will retain their value in the same way over the next 3-4 years. Supply/demand is very hard to predict and the big issue is the rate at which the technology is advancing. What's going to happen to the value of cars with a 150 mile range, when comparable models with 250+ mile range are available on cheap finance deals?
Leasing appears the new thing but doesn't make any sense to me. I was looking at new Zoes and Peugeot at the start of the year. The monthly cost of leasing was identical to the PCP finance cost with same the deposit. The shortest lease I've seen is 2 years, I might lease for 6 months while I decided if the car was right for me (could be a good way to win over EV sceptics). This is another step missing from your calculation. In 3 years time, the lease comes to an end, do you hand the car back and say I no longer need personal transport, or do you pay another £4k deposit to lease a replacement vehicle? (Assuming life outside London where public transport is not a viable option). Even if you go back to the dealer after 3 years of pcp, the trade-in will probably cover most or all of the deposit on the next car. Which makes PCP savings even greater over leasing.
Can you do a video on what games you can play on the Tesla screen whilst in lock down - Easter eggs and other fun things you can do with a tesla whilst going nowhere. Can you just sit in your car and use it as an office and watch videos all day?
Brilliant love your honest and informative videos, I too am coming to the end of my lease with kia soul ev, wanted a tesla next and your working out has really helped. 👍
according to parkers a 3 year old Tesla model S list price of about £90,000 is worth about £40,000 in a private sale so I think the model 3 at less than half the cost of the S should be about £26,000 as its a more mainstream and popular car, would a larger deposit and a bank loan be better. £18000 dep, £20600 over 3 years at £603 PM =£21105 plus £18,000 =39105 less £26000 leaves £13105 as total cost in depreciation over the 3 years
Couple of reasons why I haven't sold my cars privately for years.
1) I have always cash bought my cars and would therefore have always relied upon the trade in of my old car to make sure I'm not without a car at point of sale.
2) My traded in cars still have decent value of 20k ish so avoids depleting savings more for the new car until you can sell the old one that you then also have to insure etc at the same time as new one.
3) I privately sold my very first car. The person who bought it nearly killed me on the test drive twice and damaged wheel by smacking a kerb which was a scary experience.
4) I've since owned performance cars and the last time a sold privately I discovered most people don't spend a decent amount of money on 2nd hand cars bought from someone's driveway without warranties from a dealer etc and what you get is idiots turning up who just want to rag your car. No thanks.
Do you not think that the value is going to drop a decent amount on model 3 in next few years as competition gets there, more cars become available and Tesla cut prices like they did with the model S or they make updates to hardware that earlier models miss out on making them a bit obsolete? I think people still tend to view electric cars like their mobile phones so they just buy new and finance as they don't want to be stuck with it years down the line. I worry you might be being a little optimistic with your value expectations at the end of your PCP.
I leased my 2018 hyundai Ioniq because I don't think many people will want to buy a 4 year old 130 mile range ev in a couple of years time. I didn't want to struggle to get rid of it.
Still under Warranty and for someone who only commutes to work and back, maybe occasional longer trips. Sounds perfect.
3 years from now the economy will look very different to even one month ago. Keep your options open at the moment, don't commit if you don't have to while things are like this. I predict a lot pcp and lease deals being defaulted on in the next year or two, so a market surplus with fewer buyers wanting to enter into multi year deals.
The rant was quite thought provoking, I can never be bothered to sell my cars on. Thanks, made me think.
I bought my i3 on PCP 4.9%. After six months I took out a personal loan from Tesco bank - 2.9% and cleared the PCP. So the car is now mine and has a clear HPI check. Although the interest rate is lower, my monthly payments are slightly more (talking £7.34 more), this because I no longer have the balloon payment hanging over me.
My first brand new car will be an e-Niro via a salary sacrifice lease. It's a no brainer - the very cheapest private lease I could find would've been £19k over 3 years including insurance, tyres, breakdown cover, servicing and tax. The only PCP deals I can find are more expensive. I'll be paying £13k.
Normally I'd buy a 1-2 year old car that's still in warranty but significantly cheaper than a brand new one, but given the rapidly changing nature of the EV market and the amazing deal I can get, a lease makes the most sense for me right now.
Thank you for creating the very useful video. Please could you create a part II, which looks at buying the car outright and keeping it for 5 years. PCP versus a Bank loan over a five year period. The manner in which you present the material is simply fantastic - a natural !
Simply look at the interest rate and total amount payable. Whichever is lowest wins.
Hi, once again great video.
Just to add some insights regarding the financing of an EV (and vehicules in general), dont forget that leases or PCP are getting less and less interesting moneywise as your mileage increases. For my part, I have to drive a bit north of 30 thousand km per year (around 18K miles for non SI fluent readers). The monthly payment for a lease or PCP (they were very close) were around 650 euros/month for a 5 year contract, and I would still have to pay about 22k € to keep the car at the end in the PCP proposal. I bought my LR model 3 by financing it through a bank loan on 7 years as I could keep the monthly payment below 600, and be able to sell the car if and when I see fit. All in all a better deal and less constraints. Several banks in europe (I now French, belgian and Spanish banks for sure do) have special loan offers for green vehicules (EV/PHEV) with very low interest rates (think less than 1.5%... sometimes even less) so if your mileage is high, do consider going for a "classic" bank loan as it can get cheaper this way.
I do 18k miles a year and I think as well the very best option it is getting a bank loan.
B mathieu Mileage is irrelevant with PCP unless you hand the car back to the finance company. Just put the lowest amount and pile the miles on.
@@ElectricVehicleMan sure but in this case the balloon (last payment) is going to go up (basically you always pay the same amount, the mileage is just going to shift the price on the monthly payment or on the balloon). If you intend to keep the vehicule then you're better off going for a traditionnal loan as the interset rates are going to be lower. That said, PCP/lease remain very interesting if you don't intend to keep it and know (or bet) on being able to ressell the car for a good price at the end of the lease and pay the financing company with that money, I agree. I actually looked into that but got cold feet in the end and choose a more traditionnal way (first EV AND first new car buy so...)
Once you realise there is no actual benefit from having the GFV, you then realise PCP is just an extraordinarily expensive way to borrow money to pay for a new car...
I just can't fathom the idea of paying over £4k (in your example) in interest to a finance company for absolutely no benefit. I simply wait and build the cash first, or if I am very impatient then I borrow as little as possible for as cheap as possible (lowest APR, overpay, shortest term, etc.).
If monthly budget is the main driving factor for choosing PCP, then simply wait and save up more so you borrow less from a personal loan and get to the same monthly cost that way. The less you borrow, the cheaper it gets.
Lewis Carpenter Save up your pennies and pay cash! 😝
In my life i have always purchased a car by getting a good rate bank loan, then the car is mine from day one, pay it off in 3 years and sell it and the full price is mine to do what i want, handy if for instance you lost your job sell car and you have a wad of cash to survive with, I have always thought that a lease or cpc is an expensive way to go.
My car had 0% pcp deal so I’m happy.
@Lookup2Wakeup Covid-19 hoax? Come and spend the day with me and I'll show you what this hoax of yours looks like.
@@jamesinbradford5882 what car was that
@Lookup2Wakeup maybe you should spend some time in hospitals without any PPE & find out for yourself how much of a hoax it us you twat!
I've done cash, bank loan and car finance. The problem is, the cheapest option can change every time you look. Sometimes with PCP you effectively have a loan of a smaller amount (predicted depreciation, rather than total value of car), so even with a higher apr, the monthly cost can be lower. You also come up against manufacturer and dealer incentives - last time I took a finance deal, the dealer and manufacturer "deposit contributions" were more than the interest over 3 years, so I ended up taking finance, even though I had cash to buy. A spreadsheet is the way forward!
With PCP I like the option in the background to have a 50% break out clause or voluntary termination as a safety if things go pear shaped without issue to credit rating. Also my PCP provider allows a sale at this point if required. On hire your in to the end as I understand it or pay all remaining payments to exit early.
It’s the huge depreciation that has always put me off having a new car. I’ve done it twice in 40+ years of driving and lost loads of cash on both occasions.
I appreciate electric cars, at the moment, don’t depreciate so much, but a friend of mine works at a university that is working with a “major manufacturer”, (they can’t say which one!), and he has advised me that we will see a huge change in electric drive vehicles within the next 2 years, and has said “Don’t buy a battery car new now - it will be “old hat” in three years”. The only clue he could give is that it doesn’t involve battery development. (Sorry if that upsets you, but the Tesla 3 is without doubt the best ev at the moment)
Your friend is right that car batteries are in early phase and big changes are coming but he is wrong on time scale any it's like computer you can always weight 6 months and get a much better one
Watching this 2 years later and I agree with you. The prices of used Tesla model 3's on autotrader are way above 30000 pounds. The lowest I have seen is 36k for a 2019 model with about 40k miles. Performance models are as high as 48k.
Depending on the actual apr on PCP it is probably cheaper to get a longer term loan and pay cash and then after 3 years sell and pay the loan off.
You're bound to get a lower apr with a bank (least with other dealers)
The thought occured to me, especially currently.
Tesla is 4.9% as an example at the moment. High value personal loans are around 6%. If you can keep it below £25k you’d get around 3% so that’d be worth doing if you can put more deposit in or buy a less expensive car :)
@@MrKlawUK If you're in Scotland you can get £35K from the government (energy saving trust) on 0% for up to 6 years towards a new electric car.
You can even do a personal loan for the rest which would be under £10K for a Standard Range plus model 3 (just not a regular car loan - as there isn't the option for the bank to own the car if you don't pay the loan back).
In that circumstance, so long as you have a decent enough credit rating to qualify for the loan, PCP makes no sense in Scotland on a Tesla.
did this with my used LEAF, borrowed £7k at 3%. cheaper than car finance PCP etc... can always sell the car whenever I want and pay off the loan if it came to it.
I'm across the pond and really like your videos. When you run out of car-related things to do, I absolutely like seeing you take the car around town and on trips...I like to see where you live and what it's like where you are (no, I'm not a creep). Take a short weekend trip to a resort nearby, picnic or something, overnight maybe, and take video. I suggest you organize an electric car club (if you haven't already) or organize a Cars & Coffee in your town.
I’m a Yorkshire man too, best way to buy a car is to get an mot failure and fix it yourself, run it for a year and sell it with a new mot. I ran cars for years with no depreciation whatsoever. By far the cheapest way to go.
Now, as for videos, set up sentry mode, and explain how it is done. Then show the new software, to see the footage.
Also, you could go through all of the options on the Tesla screen.
If you can carry the risk of vehicle depriciation vs. the ballon payment lurking towards the end, go PCP, its cheaper.
But if you aren't able to deal with the risk (in case car is less worth than the last payment), leasing is more expensive but also more secure.
As usual, you pay for someone else to carry the risk. Just like getting an insurance (or rather getting an insurance with a smaller deductible).
Never leased electric. Always bought cash or loan. Not a fan of leasing. Makes sense as a business owner and to write off the lease as a tax deduction, but that is a very short term thought. Your same points about a loan apply there as well. The guarantee of turning in the car is the only upside....
Very clearly explained, and you're right that GFV is usually 10-20% below the actual future value* so that's a bonus to factor in. Only thing I'd highlight is the 35 months where on a PCP you'd be forking our best part of £600 as opposed to near as dammit £500 on a lease. For a lot of people that's a negative for PCP. But yes overall you'd be better off.
*I think you're being a little over optimistic on your Tesla's selling price but we're both crystal ball gazing!
It's all about total cost of ownership over the period you intend to own the car. I came to the realisation that I was losing a lot of money on buying and selling cars every 2-3 years. I created a spreadsheet that covers all the costs and residual value (if any). Turns out it's cheaper for me to lease an E-Tron over two, three, or four year periods than it is for me to buy a Model 3 on PCP and keep it for the same time.
Great content, I was in two minds which way to go just now for an eNiro, went PCP (think I went right!!!!!) see in 3 years. Glad I have found your channel its helped me so much getting to grips with my new car.
PCP was brought in to boost sales and get people to overstretch their budget on cars they wouldn’t otherwise be able to afford.. Was and is a win:win for dealers. ( lose:lose for us!). You are also tied into servicing at main dealer with the stupid costs included! Tesla doesn’t need servicing.Finance is costly but you do own the car at the end. Bank loans are possibly cheaper now!
Great vid thanks.
Over a year on, the cheapest clean 3yr old model 3 on Autotrader is £35k, costing around £37k new, that is roughly 95% after 3 years.
The leasing costs on M3's has risen, partly due to the government funding loss on the M3, total being (currently) £23,552, @ purchase price of £40,990, that is ~57.5% of MSRP, anything over 35% on a 3 year lease is overpaying. PCP is £28,220, with £16,806 balloon.
If the current market was to remain, then after 3 yrs would be £38,940, @ £45,026 for the total cost of the PCP as a lease would be £6,086 over the 3 years (If you paid the balloon and sold).
Or you would be better off to the tune of £17,466
If the retention becomes 65%, cost is £18,382.5, or £5,169.5 better off.
This isn't true for all cars, but a regular fossil car in 2-3 years are going to start depreciating like a stone.
It's a different life for me. I bought my 54 plate Renault Grand Espace 7 years ago for £2500. It's done me well, although it cost me a few front tyres until I found out the spring was snapped.
Now it needs a new Cam-belt, the heater, a window, CD player don't work and it isn't worth keeping running.
I can only dream of spending £20k on a car over 3 years, it's a different life.
I'm glad you mentioned the emotional element, it has always been a major factor for me but it is rarely mentioned when the calculations are performed.
All you say has to make sense for a private buyer or the lease company would be loosing out. I know they probably buy at a lower price than a private buyer but even so. Of course when it’s a company it’s better to lease because they can claim the total deposit and monthly payments against tax, they can’t do that with a purchase car, then only a portion of the weekly cost can be written against tax. There is, just to muddy the water’s, another kind and that’s lease purchase! This is similar to lease but the monthly payments are larger and the final monthly payment is the purchase. I use to use this method of buying for my works van.
Good and thought provoking video. You used the word if and the phrase "it's nevver going to" a lot. Food for thought. 4 months ago i probably had £250000 equity in my property. Today? Throughout the past 30/40 years and the technology boom old and used electronic tech has without exception decreased in value as new tech comes along.
I think the interest rate is important to look at carefully and cost overall before resale. The best thing with a Tesla is the fact now even the lowest range car is good enough combined with the charging network to never worry about resale value.
The funny thing is right now, the *cheapest* used model 3 available on autotrader is £38,000! That’s a 2 year old car with 30,000 miles. So in the current market you would be way better off on a pcp.
Good explanation 👍
On direct financials leasing might come off the worst although not necessarily. Obviously makes a difference if you can offset the VAT (self-employed.)
But leasing very convenient and a new vehicle every three years without having to worry about it getting rid of the old one.
Me myself I love cars and love driving but hate all the paperwork around it. I've been leasing ever since private lease became a thing. I know I pay a bit more but I gladly pay for the service.
Thanks for that video. I always am wondering why so many people are advertising privat leasings so much. Because it sounds like you have to pay less for a car then if you would buy it with any sort of credit. But why would a bank or a car manufacturer give it to you for less money.
But to sum it up:
Leasing:
After the 3 years you have nothing when you leased a car but paid ~50 % of the cars value, but because you need a car normaly, you somehow have to either get a new leasing contract or take a credit, but as mentioned before you paid a lot of money the last years that is now gone.
Credit:
You have to pay more, overall you basically have to pay the whole car to the manufacturer and the bank that lends you the debt plus the interest, but after that you have a car, that you can either keep using, or just sell it and get a new car. But in both cases you still have something (a car or a proportion of the money to buy a new car, or something else if you think you no longer need a car)
I have my SR+ on PCP, if it doesn't give me any major problems then i'll be buying at the end, being a key worker i get to drive it every day too - I can let you know what it's like if you want ;-)
Blue n 2s?
I could get a used Nissan leaf with that deposit. The monthly instalment of £593 is absolute madness
True..but then a used Leaf is not a new Tesla is it.
Over the last 20 years - running a VW dealership -I have noticed more and more PCP deals, even with ICE vehicles it is better value (on German brands). I t is the balloon payment, and it works on residual value, non-German tend to be worth less than final payment. I have seen same customer start with a Polo, and has moved up to Tiguan through a Golf then CC, so I can confirm PCP works.
Leasing is really just for self-employed to write off tax. Another downside to lease is if you have scratches or car park dings, they charge like a wounded buffalo for these (and then sell car at Auction with damage), or go over your mileage. Lease is usually 8,000 per annum, with £0.06 + VAT per mile over that.
Interesting difference. The PCP is a form of typical lease here in the US. One thing you did not mention is what kind of penalty you are assessed if you exceed the agreed upon mileage. Here the additional cost per mile over the lease agreement is quite expensive and often forces the out right purchase of the car at lease end.
I've leased for more than a decade - so I've dropped the emotional attachment, and (usually) swap every 2 years. I usually pay 3 or 6 months as the initial payment, and look for a deal. Currently have a Golf GTE for £237/m inc VAT (was 6+23 deal, but due to lockdown will end up being 6+29). No emotional attachment and absolute clarity on costs - plus no need to sell, or finance a deposit.
I'm soon to finish my second lease and begin looking for my third.
With leasing, you chase the deal not the car!
I've just ordered a new DS3 crossback on lease won't get it till things lift with the lockdown but it is way cheaper for me and got a bargain
Prestige model, petrol so cheaper for me as current is a diesel. 24month lease I chose 8k miles a year as in the last 3 years of having current car I've maybe done 15k or a bit less so 8k is plenty paid £1.500 upfront (they take it when it's shipped) all for £147 a month
No tax to pay, no MOT being a new car don't need one if have it under 3 years, no servicing with the miles I'll be doing and at max I'd have to replace maybe 1 or 2 tyres while I have it.
Insurance is cheaper too as I get full breakdown cover so I don't need to add it to my insurance. And they waived the £199 processing fee.
I've been pondering for ages and it's just the best for me and cheapest way too do it.
I'd love a i3 even a used 2015 rex but way too expensive on PCP for a half decent model I've found on PCP they charge alot more a month with a smaller chunk at the end if you keep it where as petrol and diesel cars you get cheaper monthly payments and a massive chunk at the end which is what needs to happen with EVs instead of being more each month, that and insurance for any EV for me is £100+ a month :/
I got my Mini Electric on PCH over 3yrs 8,000 miles a year on a cheaper deal than a PCP..looking forward to it arriving eventually..
I think it all depends on how long you keep your car. Leasing is probably a better option if you change your cars every 3 years. But if you get a car that you love, then PCP would be a better option. In 2018 I bought a new Ioniq for £22,500. 18 months later my second pension matured and I was able to afford a Kona. I got £19,000 for the Ioniq and I will be keeping the Kona for a long, long time as it suits all my requirements and is a brilliant car.
Its interesting how the market (and the vehicle purchase terms) are different in the US. Here, Tesla aside, they struggle to sell any electric cars. I live in a metro area on the west coast where the charging infrastructure is reasonably well developed, and nobody in their right mind pays full price for any EV around here because they don't sell. I bought a 19 Bolt at the end of last year and got $15,000 off ($43k premier model, purchased for $28k) with zero negotiation. Less than $4000 of that was government paid, almost all of it was cash discount from Chevy. I chose to buy it rather than lease because they were offering a better deal to purchase. Just before lockdown here in the US, I leased a Kona EV. Hyundai still has their full credits from the government here, so that's $10k off right off the bat, but the dealer offered another $3k in discounts on top of that as well as leasing the vehicle to us with no additional mark-up on the lease terms itself. They also threw in $500 worth of paint protection (clear bra) that they had already installed for free. Again, no negotiation. Both cars have production dates more than 6 months prior to the purchase date, so they had been sitting around for a while.
Also, at least as far as I'm aware, in the US you have the option to purchase any leased vehicle at any time during the lease. You could lease it for a month and then buy it if you wanted to. Or you purchase it outright an finance the entire value of the vehicle (or pay cash I suppose).
On another note, I do have an attachment to my cars, including cheap/stupid ones that I shouldn't be attached to. The odd thing is that, between the Bolt and the Kona, despite the fact that the Kona is a better car in terms of comfort, technology, and even things like charging speed, I like the Bolt more. I've never been able to identify why, but your comment on not getting attached to leased cars makes me wonder if that is it. Also, although I think the terms of the "lock down" are different here in the US, I work as an essential worker (automotive technician) so I'm still driving every day. The massive reduction in traffic actually makes my life a lot easier, although it has substantially reduced the amount of cars that need fixed and really hurt the industry I work in. We also aren't really strictly locked into our houses, for better or for worse.
I am currently saving for an electric car (I shall also need a loan!) It is between the Model 3 and the ID.3. I have concerns about each car and I lean towards the Tesla. I would caution you about the valuation of your car in 3 years time. Prices of the model 3 second hand are high at the moment as there are few about. In 3 years time there should be plenty around. I do think they will hold their price better than the model S.
My concerns about Tesla relate to the constant changing of peripherals around the car. I seem to think the standard range was £42,500 a few days ago now it is £40,490.This is just one example of changes - Bjorn is not happy about changes that have happened around the use of the referral program (video on UA-cam). If the VW ID.3 is as cheap as it has been hinted the Tesla may slash the model 3 price again (who knows?). I did a bit of tyre kicking in both the Kia and Hyundai dealer which convinced me that their cars were not for me. There is no problem with Tesla dealers as there aren't any! Tesla Birmingham are not too far away (about 30 miles) and they have a van based service so that should be ok.
I’m also a Yorkshireman, £500/600pm for a car? Forget it, and the £4.5k deposit. For the price of the deposit I could buy a decent runabout a year for 5/6 years. Less if one passes it’s MOT.
Ideas for lockdown videos: What after-market accessories have you bought, or are intending to buy, for your Model-3?
I fully agree with your assumptions at this point in time . I would like to point out depreciation will be in issue in possibly five years maybe as much as ten years time ( demand and supply should equalise by then) but certainly not before that. I think PCP should be cheaper and it is far better if you need to terminate the contract early.
I would have thought that the next topic was obvious. The total collapse in sales of internal combustion engine cars, whilst electric car increased during the shutdown. Hybrids were also down showing that people are not buying the 'self charging' concept.
Can’t really predict how much the depreciation will be because it will totally depend on how the technology and options change. With ICE cars it’s very easy to predict what the depreciation will be because the technology hardly changes over time
I tend to look for the cheapest way of purchasing. With my current EV it was cheaper to get a bank loan. In the past when interest rates were high it was cheaper to get a deal via the dealer. Many dealers were offering way under 5% APR and the bank rate was at least 8%
Excellent content as usual. There are a lot people who lease their Teslas and I was beginning to think I was missing something.
All Model 3 finance deals are terrible right now. But that’ll be a supply and demand thing. Companies taking advantage.
Manufacturers generally would prefer leasing , Tesla at present may likely prefer you to buy as money comes in sooner . Leasing just rental unless you buy out at the end which for Tesla was not available in USA but maybe available in uk . Rental never makes economic sense unless you want to have new product constantly which is not economic sense
I went with a PCP deal on an e golf. They were offering 0% apr so instead of buying it outright (which I’d normally do) I jumped on a free loan 😉👍. One thing thou, I did trade my car in as I need to get to work and can’t go without it for a few weeks in between sales, or have both and insure both whilst getting rid of it. Plus it was a diesel and making weird noises - so I was glad to see it traded in. Value was reasonable too. Would love a Tesla - I’ll tap you up in 3 years 😉
I am investigating this very scenario on a model 3 . I bought my last electric car and sold it after 5 years due to work abroad. The tech change in EV in that time was huge.This has made me question buying an electric car outright ever again.I am leaning towards a PCP just as a way of affordability. Is it not possible to put the car ( Guaranteed minimum value) towards a different car (or even a new Tesla) in 3 years time on a new PCP as technology advances and other competitors will be around to greatly reduce your estimated 3 yr residual value. I think you would be lucky to get anywhere near 28k in 3 years.
@Alex de la Mare Norris Right now the used car market is so distorted. Used EV market even worse. The gamble is in 3 years will the demand and supply be the same as it is now? Who knows. If supply increases then new and used values will fall, but if demand stays as it is now (way above supply) values will hold similar to what you’ve shown. It’s all a gamble.
Worth mentioning that if you live in Scotland you are entitled to apply for an interest free loan up to 35k over six years if you are buying a new EV. The scheme is about to be extended to used EV,s where the limit will be 20k. Loans are provided by transport Scotland.
Should have mentioned that the loan is provided by the Energy Saving Trust.
I've just been approved for an interest free loan under this scheme. So, for a new MG5 Exclusive it works out as around £310 per month over 72 months. The application process was pretty easy.
Car dealerships don't tend to mention this scheme as they obviously don't make any money from it but it's a good scheme, especially now that it's been extended to used EVs as well, but there is only a limited pot of money available each financial year.
You ask for ideas for future episodes and I would love to hear from your wife about her experience driving (your) family Tesla. She said she had range and charging issues with the Leaf so It would be good to learn what has changed... if anything. I wouod also enjoy hearing from her about tge way you kept it a secret.
Also pass on at least this viewer's thanks for the work she is doing.
I note that Tesla were selling their demo M3’s for £34500 on their website last week with about 8-10K miles; a few months (9?) old. It will be interesting to see where 3 year 2nd hand values land...
Hi there... I'm seriously interested in getting an ev so your video on pcp or lease was very useful.
As far as topics for new videos what about evs and solar panels. I have solar panels and I think i can reduce my cost significantly during the summer months although I live just south of Belfast lol and we have much rain here but fab presently. I just love the idea of plugging the car into the sun essentially and getting free charging in the summer...hope you can do something on this topic..Johnathan... belfast
The thinig with solar panels is that you need to expect to be in the same house for at least 10 years to really maximise the benefit. They cost a lot up front and only really cover their cost after 10+ years (depends on your usage and weather), but it's definitely something to think about, especially if you pair it with a battery (eg Tesla's PowerWall).
Just traded in my 2018 Renault Zoe Sig Nav battery leased for an e208 GT Line (after 2 years of 3 PCP).
I was given more for the Zoe than I paid for it 2 years ago which (when taking out a low balloon payment) gave me a £6500 deposit for the e208.
Good times
On my car a PCP was cheaper a month than HP, still worked out the same price in the end. Leaving more money in my account, still paid it off early.
I have my SR+ as a lease but for a company car over 4 years. The zoe GT50(winter pack, rapid charge, metallic paint) I have on order is PCP, 7k down and 260 a month 4 years. With final payment of 11.5k. Think it will be worth much more but will probably keep for another 4 years anyway then it can be my eldest first car. We looked at leasing but PCP seemed better all round.
I've had both PCP and Lease, There are 2 factors to think about when doing PCP, 9/10 your car will be in negative equity at the end of your term, so to swap it for another vehicle, your pumping more money into a new deal. Secondly if you attempt to sell your car privately, alot of people are very cautious about buying cars with outstanding finance, also selling cars privately can be a headache and can take time....especially in the new up and coming financial climate we are entering. Lease...okay it's never yours, but neither is PCP until you pay that final balloon payment, but with lease you know where you stand and if you're okay with more or less renting a new car for your contract term....there's no issues.
I’m sorry but 9/10 you’ll be in negative equity? That is way off. It’s the other way around. If it was negative then people would just hand it back and manufacturers lose money, which rarely happen.
@@ElectricVehicleMan ....it all depends on the manufacturer. That's why some lease deals are way cheaper than other lease deals, because the residual is much better on some cars than others. But let's face it....the consumer never wins when buying cars, leasing, pcp or hp!
I feel silly now buying my automatic Vauxhall omega 2.6 CDs with 50,000 miles on the clock for £700 admittedly the Road tax is ~ £400/year and I have normally to buy another car every two years. I normally get £200 scrap value for the cars when I get rid of them because I cannot be bothered to resell them. I love being able to drive a car without worrying about keeping it clean and scratch/dent free. They are getting difficult to get hold of now because the last ones made were in 2003. I do not want to go to a Vauxhall Insignia
The one thing that really puts me off leasing is the limit on mileage per year. Pretty much all lease deals I've seen for EVs put a cap at 5000 miles per year, which, according to my crude calculations, wouldn't even cover my daily commute (or wouldn't have before the lockdown). My workplace isn't even that far away. It seems to me that leasing is really meant more for "secondary" vehicles that you would only use occasionally, maybe for the odd long journey. Unless you're prepared to pay up for the excess mileage that is but that doesn't make it cheaper.
Research better. There are lease co's out there that will do 100K+ on EV's. Most internet brokers are kids in their parents bedroom offering a deal from another provider. Go direct to the source. Major lease co's will be fine with higher mileages.
If it has to be a new car, then don't lease it, buy it and keep it for 10 years or more
Most people are unwilling to keep a car for that long. We're creatures that are easily bored. Plus the longer you keep a car, the higher your expenses.
It’s much what I do pay cash unless for the same price they want to give me interest free. I generally change every 7 years or so
@@marklola12 Obviously it won't have much value at 10 years, but it will have saved you more than any other method, so the 'lost' money should be in your bank. They do go 'out of date' in terms of fashion, and with older models, range, but you can replace the batteries after 10 years if you want and more new EVs now have enough range to keep most people happy. From my viewpoint I'd say keeping it is a pretty good bet, and anyone who says it looks old may be impressed by the cost of 10 years driving.
10 year old car is not getting u any punani vro
Many leases let you buy the car at the end too. Our e-Golf is through VWFS and it says we can ask for a quote within the last 3mo.. I'm hoping the expected value crashes just before then so I can keep hold of it at a bargain price 😁
When I compared many PCPs and leases last time around, the lease was always cheaper (assuming handing it back and/or that the PCP final payment is a fair estimate of the value will be). One of the dealers told me it's because the PCP has to build in some to cover the consumer protections you get with the PCP that you don't get with a lease (it's easier to get out of a PCP if your circumstances change, for ex.).
Thanks EVM, it's always good to have payment options compared like this. Of course, it's always going to be cheaper to pay cash for the car upfront rather than any form of borrowing but that just isn't an option for everyone.
Idea for lockdown episode? Specifically for Model 3 interest (apologies to other EVs), can you look at dimensions that aren't easily available online? Things like, how long it is from the front to the A and B pillars and how much room you need if parked in a typical garage. I've ordered a TM3 (on lease!?!) and I've had to make some alterations to my garage to accomodate parking/charging etc. I had to make an educated guess at how much room I'll actually need in order to get the drivers door open, walk around and plug it in as although length, width and height and wheel base figures are easily found, something more practical like how far the doors open is tricky to find on Google. I just hope I've estimated enough! Just an idea but no-one else has done one as far as I can tell. Keep up the good work mate.
Thanks for this info. I'm currently in a PCP deal with a diesel Kia. In my scenario I actually do think that I'll be just handing back based on the fact that diesel is dead. I actually assumed that to be the case when I took out the deal 3 years ago, so I'll give with that. But I'm certainly getting my next car on PCP, and it will be a Tesla M3, probably your exact spec.
In my mind an important part of the Tesla experience is being able to purchase the FSD or boost upgrades if you require them after receiving the car. Prospective Leaser's BEWARE I have also recently leased a Model 3 Long Range and have been told by LEX AUTOLEASE that I am not allowed to upgrade the car. They didnt tell me this before signing on the dotted line.
Totally agree with the attachment thing, My crappy Mondeo is lease and couldn't care less about it. Great vid by the way.
I haven't seen a review of the model 3 camper yet. You could have a lovely drive out on to your driveway and sleep under the stars (for 5 minutes). Put a green screen up and have a virtual road trip across Europe.
The car manufacturer has no interest once a car is sold or leased. It all goes to a finance arm either owned by the car company (this is where the real money is made) or the leasing agent or your lender . The lease company gets the car back at the end of the lease and obviously would like to break even on the sale of the car. (which is calculated in the lease payment) They sell wholesale so you should do better with a private sale. If it is a business expense that will change the calculation. Nice video. I bought a Niro EV and will see what it's worth in 3 years🤔🤔
I feel like leasing vs pcp is akin to renting a house vs a mortgage. When you renew your deal after 3 years, you've either built equity or made your landlord some profit
A house will generally increase in value over time. A car never will.
Interesting. I think you should have made it clear that it all depends on the actual deal, the car, and the annual mileage. PCH can be cheaper than PCPs and everyone should do their own calculations to decide which is better for them. In my personal experience, I got a nasty surprise in my PCP deal when after 3 years, I discovered that the balloon payment was much higher than what the car was worth. I had no option but to give the car back. A PCH would have been much cheaper.
With p/ex you will only get bottom book from any dealer no matter how many miles it has done and is perfect condition. You can try selling it privately but if you have a car that is worth quite a bit you will have no chance of selling for cash. Been there tried it just a lot of idiots wanting it for next to nothing.
Another subtlety I've discovered, is that the price of the car is sometimes cheaper if you're buying using a dealers PCP own finance, rather than say, paying cash.
I have an ICE car which is 12 years old, still in good condition. I have an EV on PCP right now & will keep it as at the end of the day I think it works out cheaper.
As far as I can work out with my ICE car which was £23,000 new & apparently only £2,000 as px it is still cheaper than leasing & the same with the EV as even if I have to start paying road fund licence/ Road tax it will be still cheaper to keep at the end of the PCP period even if I have to get new battery pack after 8 years!! But it'll be more likely after 10 years & only those that have died.
I have a lease deal coming to an end on a Golf - they've offered me an opportunity to buy it so I never quite understand the 'no option to buy' at the end thing.
Most don’t but it is an option for some. However if the intention was to buy it then doing that in the first place usually is better as you’re not factoring in the lease company needing to make money into it.
I thought the car wasn't yours to sell until you pay the balloon payment?
Until you've made the optional final payment to settle the PCP agreement, however, the car belongs to the lender, so you can’t simply advertise the vehicle and sell it whenever you like. This remains the case at the end of the agreement: until you have made the final "balloon" payment to buy the car, it’s not yours to sell.
I always think of it this way?
Lease is like a company taking out PCP and letting you use the car over the 3 years. They wouldn’t do it for cheaper than you could do it yourself. Yes they can get some better deals on outright price but.....
Wrong mostly lol I have ordered a new DS3 crossback prestige on lease 24month 8k miles a year...I only have done 15k if that last 3 year so 8k is plenty £1.500 upfront and it's only £147 a month
Everywhere else on lease is wanting over £200 and PCP new and PCP used is more than what a lease is
It's the same for a few different cars I've looked at.
Can get a new version Zoe the iconic one for £170 a month on lease
It's a no brainer, £3500 grant, future residual value (granted unknown) and the fact that dealers make more profit from second hand cars than new it has to be a cheaper option to PCP. Only down side is whether you can afford the monthly payments on the PCP, which are less on a Lease plan.
In my experience if you like the idea of having a new car every 3 years or so then PCP may not be the cheapest way forward.
If that isn't the case then ICE vehicles will have a worse residual value against an EV car I believe. It's all a matter of choices.
I would be interested to see if there is any significant drain on the battery when it is standing. There is a video (somewhere) where the car is left for a period but I would appreciate your findings on this.
Sympathies. I bought mine in January. Been sat quietly since lockdown..
Interesting video. I done the same, yet to receive my Tesla, but my rationale is similar! However, Tesla actually offered me more for my Skoda than other dealerships (upwards of £2000 more). Private wouldn’t have gotten much more. I’d like to think Tesla are more keen, if that was the case I’d be hoping they’d offer more than others for their model 3 back at the end of the PCP!
Overall, it seems like PCP is somewhat of a gamble. But it feels like it’s worth the risk for a Tesla Model 3 at this moment in time. Reminds me slightly of the stock markets, you could very easily end up coming out smelling of roses or not. It’s just the way the cookie crumbles!
Interesting video. Thanks for spending the time to explain.
I’ve been trying to persuade the missus to get a mini electric on pcp. We’ve always purchased our cars outright in the past and have never used pcp. I did all the sums and calculated a saving of £120 per mont for a 100 mile a week commute. This included servicing and tax spread over the year. Problem is that we would be worse off monthly because I currently pay nothing for the car I own.
I’d really love a mini electric to sit along side my other ICE car which would be used for longer journeys and hauling the kids around but trying to justify the monthly spend of pcp to my missus just didn’t work 😒
Not sure if this has been mentioned but with a Tesla model 3 there is £480 per year luxury car road tax to pay.( for cars over £40k). If you lease the car the lease company pays the tax, but it is down to you if you get a PCP deal. Worth factoring in your calculations.
That hasn't existed for 18 months.
@@ElectricVehicleMan Ok, thanks for clarification. I now see that pure electrics are exempt. 👍
I just had Tesla give me a trade in price for my 64kwh Kona Half bloody price , he said its because of the pox . i was going to ask him if the Tesla would be half price too. 18 k for a 35k car
Great video!👍 I think you need to factor In 3 years time Tesla will have serious competition and will need to improve both on price and specs, both of these massively effecting the price of the current Model 3, no way will it be worth £26k when you'll be able pick up somthing like a new id4 or Ev6 for near that?
The new battery day announcements could really hammer the predictions in this video? If the price of new entry level SR model 3 falls significantly in the next 12 months, which is likely, achieving even £22,000 is unlikely, buyers don’t care what you paid in 2020!
I predict that the Model 3 will retain much of it's freshness with Tesla's ability to totally reconfigure the touch screens software. The batteries technology will improve with age, but that will mostly let you have more power and range with fewer battery cells. It is very hard to predict, but the Model 3's body should retain much of it's style and newness.
I am a person that loves technology and I've always gotten bored with my cars, but I keep them for several years out of economic necessity.
I’ve always bought cheap second hand cars, and mainly delivered them to the scrapyard when they started complaining too much. We bought our SR+ outright, cashing in a 20yr investment/saving policy.
If we hadn’t have had the savings, we’d have gone the PCP route...or a loan of some sort.
If Tesla’s are built with truck longevity, which they seem to be (at least the latter ones), then we hope it’ll last us 20/25 years. Good cars are part of the family to us, and it wouldn’t feel right leased.
Unsecured loan suited me, could sell the car and pay the loan straight off if needed.
Interesting video thanks. Been an EV driver for 6 years now... always PCP'd but this time I really wanted a Model 3 but when the time came to change they were still not released... so I opted for a short personal lease of a BMW i3 as a stop-gap.
My next car WILL be the model 3!... but I had the same thought process as you as to whether to go back to PCP or stick with leasing going forward. I know its not the same thing but that huge initial payment is a bitter pill to swallow especially when you know you'll never see it again. When its a deposit on a PCP you know you'll get some of it back someday.
I agree with your feelings on 'ownership' - the lease car just doesnt feel like its mine, or can ever be mine - therefore there is quite a weird detachment feeling driving it around. Also you are super paranoid about any minor scratch or stone chip knowing that the car will be forensically examined at the end of the lease and whatever the definition of 'reasonable wear and tear' being when the time comes.
It does feel to me like PCP is the way to go for the reasons you've highlighted.
Two things...
I'd rather buy a car that has been "owned" rather than leased for exactly the reasons you made over peoples attitude to the car if they know they've only got it on loan. So a PCP car should attract a higher price from anyone in the know.
Also, if you lease a car and go over the mileage you agreed, you get stung sooooo much. With PCP, I believe it's your problem.
Interesting vlog, and I agree generally about residual EV prices being better than ICE cars for the next few years due to availability.
Ronnie Lloyd every pcp deal I’ve had, has come with an excess mileage charge, per mile over what was stated upfront.
My lease my new model 3 has exactly the same. Cost per each mile over.
Obviously, the pcp one matters less if you decide to purchase it.
But my lease deal has the same option to buy too.
PCP excess mileage only comes into play if you hand the car back.
I am a bit like you at the moment just got my KIA E-Nero 4 just before lockdown not even had to recharge it yet I must say great improvement on 1st edition.
Ref PCP my last car was on PCP it was a C220 AMG LINE Estate one I wanted for years treated myself on 65 birthday after 3 years the balloon payment was about £3500 below what they were selling for so like you say all depends on what car you have.
I was going to trade it in for the Nero but as usual the dealer offered me about £3000 below what I think it should be worth but Heh Ho then lock down came so if you know who wants a nice Merc Estate please let me Know.
Another great video Regards Jim V
With leasing you are just perpetually paying hundreds per month for the rest of eternity and for what - just to have new shiny bauble every few years on the drive to show off to the Jones' down the road or the cleaner at work? Call me old fashioned, but I like to actually own the things I pay for whether it's via a loan or cash.
Thank you. Very interesting and it's nice to hear good figures and estimates from somebody who has investigated and knows the market - as opposed to some who'll just guess, pull figures off the tops of their heads or say something that makes it sound what they think the viewers want to hear.
Have you done a side-by-side comparison of your two EVs yet? Not just range and handling but actually living day-to-day with the cars.
Thank you once again.
another expence, when leased the lease company pays the road tax, which can add upto another grand or so, and i've not done a lease myself, but i've heard you can get the option to buy it at the end of the lease
Currently bull electric cars are £0 road tax.
Hmmm. I suspect you're right in the case of Tesla (premium brand, class-leading range etc), but I'm not convinced that other EVs will retain their value in the same way over the next 3-4 years. Supply/demand is very hard to predict and the big issue is the rate at which the technology is advancing. What's going to happen to the value of cars with a 150 mile range, when comparable models with 250+ mile range are available on cheap finance deals?
our thinking is aligned.
I bought my Lexus on pcp.. my ballon payment would be 6,700. The car worth 10,500 online . I will be selling it privately
Leasing appears the new thing but doesn't make any sense to me. I was looking at new Zoes and Peugeot at the start of the year. The monthly cost of leasing was identical to the PCP finance cost with same the deposit.
The shortest lease I've seen is 2 years, I might lease for 6 months while I decided if the car was right for me (could be a good way to win over EV sceptics).
This is another step missing from your calculation. In 3 years time, the lease comes to an end, do you hand the car back and say I no longer need personal transport, or do you pay another £4k deposit to lease a replacement vehicle? (Assuming life outside London where public transport is not a viable option). Even if you go back to the dealer after 3 years of pcp, the trade-in will probably cover most or all of the deposit on the next car. Which makes PCP savings even greater over leasing.
Can you do a video on what games you can play on the Tesla screen whilst in lock down - Easter eggs and other fun things you can do with a tesla whilst going nowhere. Can you just sit in your car and use it as an office and watch videos all day?
Brilliant love your honest and informative videos, I too am coming to the end of my lease with kia soul ev, wanted a tesla next and your working out has really helped. 👍
according to parkers a 3 year old Tesla model S list price of about £90,000 is worth about £40,000 in a private sale so I think the model 3 at less than half the cost of the S should be about £26,000 as its a more mainstream and popular car, would a larger deposit and a bank loan be better. £18000 dep, £20600 over 3 years at £603 PM =£21105 plus £18,000 =39105 less £26000 leaves £13105 as total cost in depreciation over the 3 years