[alex_chung]

Originally Posted by MashinBenzin

It's likely to be a while before a 2014 car becomes unfixable or too expensive to repair, so this is likely your best option from a purely financial point of view.

The draw of new metal is a major one though, none of us can deny that.

Agreed! Its always the downfall of any petrol head, I think its time for being sensible now and maybe in the future I can get something that is shiny.
Alex

[HighlandPete]

I'm surprised at the amount of comments where the nearly new car is having such a high hit on an early trade.

It has always been this way with volume sales, and that is where BMW is at the present time. Long gone any degree of exclusivity, which helped hold up the nearly new car prices.

Begs the question, why do so many users change a premium car so early? Part of the idea, IMO, of buying 'premium' is to get more life out of the car.

Anyone changing a car at less than 4-years, IMO, should expect to pay the price of change, due to the way depreciation works. Extend to 6-years and depreciation is levelling off, and we get more value out of a car.

Trading at a year or two is a sales team's dream, (all marques), folks are usually serial car buyers, desperate to change, or simply money to throw at cars, (some with more money than sense) whatever the car cost. The 'must have' segment help feed the good used stock on forecourts.

The clues to higher depreciation have been with us for a few years, PCP deals, the high discounts (can't have it both ends of a deal), a flooded market.

When I bought my 535i at just over a year old with just 6k miles at 40% under list, tells us the market is only going one way.

I believe a lot of folks don't look deeply enough into the real cost of running a car, particularly depreciation. Simply look at the total cost, knock of the GFV and divide by the years on the PCP. Get the annual depreciation figure, if we keep the car for the term. It is a real reality check. Say invoice cost is £37k with £16k GFV over 3-years; £7,000 a year in depreciation. Early trade, that figure will be front heavy.

[Hooded]

Originally Posted by MashinBenzin

It's likely to be a while before a 2014 car becomes unfixable or too expensive to repair, so this is likely your best option from a purely financial point of view.

The draw of new metal is a major one though, none of us can deny that.

Any well looked after BMW under 10 years old should almost always be fixable/cost effective to repair, unless it needs a complete new engine.. surely?

[MashinBenzin]

Originally Posted by Hooded

Any well looked after BMW under 10 years old should almost always be fixable/cost effective to repair, unless it needs a complete new engine.. surely?

Definitely. And the answer to keeping the new car comfort blanket (against a very bad failure) lies in the extended warranty.

[454697819]

Originally Posted by Hooded

Any well looked after BMW under 10 years old should almost always be fixable/cost effective to repair, unless it needs a complete new engine.. surely?

With the exception of significant electrical failure I would agree, a mechanical failure will always (or nearly always) have a determined fix, even if its an engine out, rebuild and re install job.

Electrical failures are the work of the devil and are my greatest fear with a "modern" car.

Oil is the lifeblood of an engine, and I plan on changing mine every 10k in due course :-)

[robbiep]

I'm always astonished at the number of people who quote PCP deals whilst seemingly forgetting to factor in the deposit.

A classic example a few months ago : Someone I know was looking at a Volvo, £199 per month on a 3 year deal. They'd completely failed to notice that the deposit of £3500 was the equivalent of adding nearly £100 per month onto the cost of the car.

Seen it on here plenty of times too. Someone saying about their wonderful PCP per month cost, and treating the £3-4,000 deposit like a sideshow.

[inkiboo]

Originally Posted by SEW247

BTW does anyone know how long BMW will extend warranties for?

My 16 year old E39 M5 is still covered by BMW extended warranty

[HighlandPete]

Originally Posted by MashinBenzin

Definitely. And the answer to keeping the new car comfort blanket (against a very bad failure) lies in the extended warranty.

And pretty much to the value of the car. I had a new V8 engine on extended warranty, well into 5 figures. A massive comfort when BMW's engine guru told me "if it needs a new engine it will get one".

[moff]

My experience is that every manufacturer now takes PCP deals to the wire - so no equity left at the end of the deal - regardless of deposit.

Depreciation in similar cars e.g. Audi S4, MB C43 will be similar to the 440i for example, but will follow a curve based on 1) how new the car is, 2) LCI, 3) supply / volume and 4) how to close a new model

Question from me... given the the GFV's all seem to be wrong has anyone actually challenged BMW FS e.g. your car is worth £15k and the GFV is £20k. Has anyone offered £15k to BMW FS??

This would seem to make sense for BMW FS as it costs a few grand to either re-market the car back into the network or to sell via an auction.

I think that this could be a good route to go, take out a low interest loan e.g. Hitachi @ 2.9% APR for the GFV, buy at px value from the dealer, drive for 6-12 months and sell privately?

[MashinBenzin]

Originally Posted by HighlandPete

And pretty much to the value of the car. I had a new V8 engine on extended warranty, well into 5 figures. A massive comfort when BMW's engine guru told me "if it needs a new engine it will get one".

Nice! I had the N47 timing chain issue spotted at the MOT (pre-failure and I hadn't complained about any change in noise). Car in the workshops for over a week, a decent F31 loan car for the period. It really is an excellent investment and makes the 3-year old change point irrelevant.

[Sasquartch]

I don't get the concern about depreciation - all mainstream cars have always depreciated.
A friend who used to sell cars reckoned a value halving every 2-3 years was about right
Most cars reach shed status by say 12 years old at which point they're worth 1-2k at most
So a 40k car halving in value every 3 years will be worth £2.5k at 12 years old
It's difficult to get true figures for depreciation on new cars as there are so many discounts off the list price. But I'd be surprised if the figures are much difference between BMW, Ford, Peugeot in percentage terms
I bought a second hand car for cash which as an AUC was probably 2k over it's true worth as I'm paying for the warranty and general overheads of the dealer. It's probably lost another 2k in depreciation in the year I've had it.
It's just a fact of life with buying cars - new cars are less hassle, latest tech, impress the neighbours etc but you pay for it

[HighlandPete]

Originally Posted by robbiep

I'm always astonished at the number of people who quote PCP deals whilst seemingly forgetting to factor in the deposit.

Same here, too much obsession with the monthlies. Plus the old out dated assumption there should be equity in the car at the end of term.

I thought the idea of positive equity disappeared years ago. Certainly had evaporated when my 330d ended its term in 2009. That's 8-years ago.

I recall many users having negative equity 'massaged' into the new PCP deal. You then have really had it attached to another term.

[Canary_Yellow]

Without wanting to go off piste, how much does the BMW extended warranty cost for a 330d?

Or is that not something that is easily answered?

[robbiep]

Annual payment, probably somewhere between £400 and £500.

Though it may be higher if the car is high mileage, or depending on the excess you choose, or lower if you go for less cover.

I know my 325d cost me about £500 for year 4, that was covering everything, with a £100 excess, but also including BMW assist. I seem to recall it could have been as low as about £300 without BMW assist, with a £250 excess, and covering drivetrain only.

[Sasquartch]

I've just taken out a policy on my 328i (2012) with 42k miles. £250 excess but comprehensive cover
I think about £47/month but does include European assistance which was the main reason as I'm travelling abroad soon so saves paying for cover elsewhere
There are cheaper option, driveline only etc
Below is the quote I got, obviously will vary with model, age and mileage :

[moff]

Originally Posted by Sasquartch

I don't get the concern about depreciation - all mainstream cars have always depreciated.
A friend who used to sell cars reckoned a value halving every 2-3 years was about right
Most cars reach shed status by say 12 years old at which point they're worth 1-2k at most
So a 40k car halving in value every 3 years will be worth £2.5k at 12 years old
It's difficult to get true figures for depreciation on new cars as there are so many discounts off the list price. But I'd be surprised if the figures are much difference between BMW, Ford, Peugeot in percentage terms
I bought a second hand car for cash which as an AUC was probably 2k over it's true worth as I'm paying for the warranty and general overheads of the dealer. It's probably lost another 2k in depreciation in the year I've had it.
It's just a fact of life with buying cars - new cars are less hassle, latest tech, impress the neighbours etc but you pay for it

I'd suggest most are losing 50% after 2 years at the moment.

[HighlandPete]

Originally Posted by moff

My experience is that every manufacturer now takes PCP deals to the wire - so no equity left at the end of the deal - regardless of deposit.

I believe it is driven by competition. The idea of the PCP deal, there would be enough positive equity at end of term, to be the deposit for the next car on PCP.

That cushion appears to of been taken out, all the figures 'adjusted' to get the best possible monthlies, and forget the intro to the next car. I suspect it verges on mis-selling, if sales give the idea there will be enough 'deposit' in say three years time, to start over at similar costs. Should be more clear that any equity at end of term is a 'bonus', rather than factored in. The only financial protection is if you hand the car back at the end of term.

Plus there's the fluctuations in the car market, residual values are often (currently almost certain) dropping more than projected.

[HighlandPete]

Originally Posted by moff

I'd suggest most are losing 50% after 2 years at the moment.

Certainly looks that way. Whereas a few years back a BMW would be something like 50 - 55%, at 3-years/30,000 miles.

[moff]

Originally Posted by HighlandPete

I believe it is driven by competition. The idea of the PCP deal, there would be enough positive equity at end of term, to be the deposit for the next car on PCP.

That cushion appears to of been taken out, all the figures 'adjusted' to get the best possible monthlies, and forget the intro to the next car. I suspect it verges on mis-selling, if sales give the idea there will be enough 'deposit' in say three years time, to start over at similar costs. Should be more clear that any equity at end of term is a 'bonus', rather than factored in. The only financial protection is if you hand the car back at the end of term.

Plus there's the fluctuations in the car market, residual values are often (currently almost certain) dropping more than projected.

It is and isn't mis-selling.

The sales person should not lie and say there will be equity, they haven't got a crystal ball to account for market changes.

But we the consumer is fully protected by the ability to 1) VT and 2) return the car to BMW at the end of the contract.

I think we all need to look at PCP's with are eyes wide open - they are rental agreements. But the advantage over say PCH is that they allow us to add extras and not pay 100% value of them.

If I was buying a car that didn't need extras it would be PCH (leasing) for me every time.

[rich100]

Originally Posted by moff

My experience is that every manufacturer now takes PCP deals to the wire - so no equity left at the end of the deal - regardless of deposit.

Depreciation in similar cars e.g. Audi S4, MB C43 will be similar to the 440i for example, but will follow a curve based on 1) how new the car is, 2) LCI, 3) supply / volume and 4) how to close a new model

Question from me... given the the GFV's all seem to be wrong has anyone actually challenged BMW FS e.g. your car is worth £15k and the GFV is £20k. Has anyone offered £15k to BMW FS??

This would seem to make sense for BMW FS as it costs a few grand to either re-market the car back into the network or to sell via an auction.

I think that this could be a good route to go, take out a low interest loan e.g. Hitachi @ 2.9% APR for the GFV, buy at px value from the dealer, drive for 6-12 months and sell privately?

I would have thought that BMW FS would be extremely unlikely to enter into this type of negotiation. The GFV is simply a component of the credit agreement that the buyer signed up for at the outset and is therefore liable for if they want to retain the car.

I think the term guaranteed final value is somewhat misleading. The guarantee in this sense I believe relates to the borrowers ability to simply hand the car back at the end of the term and walk away owing nothing.

Arguably in the example above if the final payment is 20k and the value of the car is 15k then the logical option would be to walk. I believe this happened frequently when the market crashed during the early stages of the credit crunch in 2008/9.

My PCP ended 12 months ago, the car is low mileage and I decided to pay the end payment and hang on to it. The GFV seemed about right to me from reference to two or three of the valuation sites (not an exact science I admit but close enough to give an idea)

[moff]

Originally Posted by rich100

Arguably in the example above if the final payment is 20k and the value of the car is 15k then the logical option would be to walk. I believe this happened frequently when the market crashed during the early stages of the credit crunch in 2008/9.

Agreed it would be logical, but the market value is the market value. It would seem mad for them to walk away from a negotiated deal. I work in the industry so next time I have a meeting with a major finance company who GFV I will ask

[Dobbins Den]

Originally Posted by moff

I'd suggest most are losing 50% after 2 years at the moment.

Based on say a 40k list price or same car at a 30k discounted price? i.e. will it be worth 20k or 15k?