Your opinions - XC90 2015 trade in or extend?

[SignumGB]

Originally Posted by soupytwister

To give you an idea....4 years on a XC90 lease with no deposit is £548/month so a total of £26000 over 4 years. No upfront deposit, none of your money invested in a depreciating asset and just hand it back at the end with no worries over what it is or isn't worth. You're essentially paying a monthly fee for the depreciation. Offer currently with Stoneacre Volvo so an official dealer.

Volvo XC90 Estate
2.0 B5P [250] Momentum 5dr AWD Gtron
Initial Rental:
1 Months
Term:
48 Months
Mileage:
8,000 p/a
Transmission:
Automatic
Fuel Type:
Petrol
Road Tax:
Fully Included
Maintenance:
None
Finance Type:
Personal Contract Hire
£548.77p/m
Initial Rental:
£548.77
Additional Fees:
£0.00
Total Lease Cost:
£26,340.96
All prices inc. VAT

All that money spent and nothing to show for it at the end.......

[MCV60]

Personal lease for me once my current PCP comes to an end. Where I shall be returning with out paying the option bubble. Providing the finance deals suit me.

My current usage requires diesel and I am worried about the depreciation of future diesel vehicles.

I don't understand why people get hung up, on having a car at the end (nothing to show for it). No one persons the situation is the same.

IMO, If I can have hassle free motoring in a brand new car for a fixed term and monthly cost, that suits me.

Alternately, I can buy a second hand car, with ??K miles and worry that, 1) its out of warranty. 2) what may go wrong and have to foot a bill or bills.

[hrp123]

Yes, I agree it will likely take 2023-2024 before the car is released and all the issues ironed out. Someone in Volvo UK was saying the Polestar models have some teething issues already. Plus the new cars will probably be more expensive to start with.

[hrp123]

Originally Posted by soupytwister

To give you an idea....4 years on a XC90 lease with no deposit is £548/month so a total of £26000 over 4 years. No upfront deposit, none of your money invested in a depreciating asset and just hand it back at the end with no worries over what it is or isn't worth. You're essentially paying a monthly fee for the depreciation. Offer currently with Stoneacre Volvo so an official dealer.

Volvo XC90 Estate
2.0 B5P [250] Momentum 5dr AWD Gtron
Initial Rental:
1 Months
Term:
48 Months
Mileage:
8,000 p/a
Transmission:
Automatic
Fuel Type:
Petrol
Road Tax:
Fully Included
Maintenance:
None
Finance Type:
Personal Contract Hire
£548.77p/m
Initial Rental:
£548.77
Additional Fees:
£0.00
Total Lease Cost:
£26,340.96
All prices inc. VAT

Thanks for this - yes, just today I started looking at the lease options but two issues (1) if you are going for a stock car then each lease company is limited by what it has access to - and it's not clear to me how to find who has what you want (2) the lease deals I saw were working out to £650 pm on a Momentum, where did you see the one above if you don't mind sharing?

I can see the logic of leasing the car - never done it, always liked the idea of owning my car - but in this age where the technology is changing quite quick it makes sense. However I cannot understand how leasing could be cheaper than buying and owning the car - even with the trade in factor - as surely the lease company has baked in a few thousand pounds profit? Is it that they can secure the cars at a cheaper price perhaps?

[hrp123]

Sorry, just saw you said Stoneacre, will have a look

[hrp123]

Originally Posted by Kev0607

I suppose it boils down to a question of finances. You can keep your car, spend the extra to renew the warranty & hopefully nothing too major goes wrong. If it does, providing its not classed as being "wear & tear", then it should be covered under warranty. Note, its best to fully read the small print on these warranties because some of them aren't worth the paper they're written on. I don't know what is & what isn't covered on an aftermarket one, but there's some good ones out there. If it gives you peace of mind & seems to cover many of the expensive parts, then why not go for it? Paying to extend your warranty is certainly cheaper than changing your car for a newer model (Do your research on what/what isn't covered though).

The only "cost" you'll have to keep your existing car is the cost of the warranty (if you decide to renew it), general maintenance that isn't covered by the warranty (servicing, tyres, bulbs etc) & your road tax, fuel & insurance (assuming the car is paid for). Changing your car for a newer one means you'll still have all these costs & monthly payments up on top of it... In essence, you aren't saving anything by changing to a newer model. Yes, it'll be the newer shape etc, but you haven't "saved" anything. I'd keep your existing car personally, especially due to the uncertain times we're currently living in. Its only five years old, there's plenty of life left in it yet!

The alternative is to trade your car in for a newer model (if this is definitely what you want to do). So, first off, you'll lose money by trading it in (You'll get more selling it private). Then there's the cost to keep your monthly payments the same - The car that is 1/2 years old is going to be worth considerably more than your 5 year old car - You have to factor that in too. Using your car as a deposit (if you trade it in) will offset a big chunk of the cost, but there still could be a fair bit difference between the cost of the new car & the amount that's actually on the table (your car), meaning you could end up with a hefty amount to finance. It costs to change a car, especially if you're jumping up a few years & want to keep your payments more or less the same (unless you can afford for them to increase)... I'm sure you're well aware of this though.

Another alternative is a lease vehicle. Is this something you've considered? Yes, you'll never own the car. However, what you pay in monthly payments is more or less what you'd be losing in depreciation if you purchased the same car on finance (The lease vehicle will be brand new, not used). Plus, you have the option to add things to your lease package like tyre cover for an extra premium per month, as well as things like a service plan (also for an additional monthly cost). Not forgetting that you'll have to leave a deposit down if you decide to lease a vehicle (usually 3 or 6 months payments) & ensure you select the right package for based on the mileage you do per year.

Going down this route means you'll have a brand new car, but if anything goes wrong with it, you just phone the lease company & let them deal with it. You'll get a like-for-like curtesy car until yours is fixed, so there's not really any inconvenience for you. The only downsides to the lease vehicle is you'll never own it, you have to pay for any damage that may occur throughout your time leasing the vehicle (Car is checked when its handed back to the finance company) & you'll be charged extra for any additional miles that you do over what was agreed in your original contract. Lease vehicles are really common nowadays, so its something to think about.

I think warranty wise, although it the Volvo sponsored car care plan at £750 is much more than £260 at ALA - I would go with the Volvo one if I was keeping the car. They have an agreed dealer labour rate, so you shouldn't be out of pocket.

The problem with reading the fine print, is I don't know what exclusions are realistically problems that could happen... it seems a little pot luck with the 2015/16 cars. I don't think all the problems are mileage related e.g. I had my steering control module and a normal (not air) suspension start leaking - only with 32K miles.

The other issue I find is being unable to trust dealers in what consumables they tell you need to be replaced e.g. in January at Watford the car had an inspection and they said the front brake pads were 25% worn (in September just 1,200 miles later (we haven't been far during Covid times) - they say the brake pads are amber and 65% worn. The tyres were mysteriously 16% worn over the same period.

So absolutely, you pay more for a newer car - over the next three years, I reckon I would spend £3K more per year on the newer car vs keeping the older car - so it's not a small amount of money - but this would be for hopefully less stress and also I would do it only if I had air suspension on the new car.

Thanks for your thoughts!

[Director76]

Lease co funders have access to the kind of fleet discounts that mere mortals can only dream about!

I’ve found that leasing always compares very favourably to owning a watching the depreciation eat up your money. It also removes the vagueness of the market, I couldn’t get anyone to take our last ‘owned’ car - a 3 year old low mileage Touareg, so in the end I took a hit and went with a WBAC type service.

Even my then VW dealer who emailed saying used car shortage we will buy your car...said, er...but not your car sir!

New T8 on order is a substantially cheaper lease cost than our current one .

[hrp123]

Originally Posted by Director76

Lease co funders have access to the kind of fleet discounts that mere mortals can only dream about!

I’ve found that leasing always compares very favourably to owning a watching the depreciation eat up your money. It also removes the vagueness of the market, I couldn’t get anyone to take our last ‘owned’ car - a 3 year old low mileage Touareg, so in the end I took a hit and went with a WBAC type service.

Even my then VW dealer who emailed saying used car shortage we will buy your car...said, er...but not your car sir!

New T8 on order is a substantially cheaper lease cost than our current one .

Did you find that when you lease a car you have to build and order it - seems like most of the stock cars are just standard models without any options.

I've been reading about the changing EU emission requirements for 2021 and it looks like carmakers will really need to build more hybrids to meet their requirements until they have a good range of electric offerings, as otherwise they will get fined (unless they can buy credits off TSLA).

It really is hard to project how (1) Covid, (2) Brexit, (3) Electric cars and (4) Anti-diesel sentiment with all affect existing used car stock 4-5 years from now.

[Director76]

Originally Posted by hrp123

Did you find that when you lease a car you have to build and order it - seems like most of the stock cars are just standard models without any options.

I've been reading about the changing EU emission requirements for 2021 and it looks like carmakers will really need to build more hybrids to meet their requirements until they have a good range of electric offerings, as otherwise they will get fined (unless they can buy credits off TSLA).

It really is hard to project how (1) Covid, (2) Brexit, (3) Electric cars and (4) Anti-diesel sentiment with all affect existing used car stock 4-5 years from now.

Yes - factory orders.

[Kev0607]

Originally Posted by hrp123

Thanks for this - yes, just today I started looking at the lease options but two issues (1) if you are going for a stock car then each lease company is limited by what it has access to - and it's not clear to me how to find who has what you want (2) the lease deals I saw were working out to £650 pm on a Momentum, where did you see the one above if you don't mind sharing?

I can see the logic of leasing the car - never done it, always liked the idea of owning my car - but in this age where the technology is changing quite quick it makes sense. However I cannot understand how leasing could be cheaper than buying and owning the car - even with the trade in factor - as surely the lease company has baked in a few thousand pounds profit? Is it that they can secure the cars at a cheaper price perhaps?

You don't own a car on finance until the final payment is made, or until you settle the agreement early - That could be anything up to five years (the term can be less obviously, but just as an example*). During that five years, the car is depreciating as it ages & the newer the car is, the more money it'll lose. Then it comes to the time when you've made your final payment & the car is now yours, but usually by the time that point comes, you've lost thousands in depreciation & paid thousands in monthly payments.

That financed car could have cost you a small fortune & then when you go to trade it in because you fancy a newer model or something different, it might not be worth that much anyway. So either the car will be left as a deposit plus cash, or if you're lucky, the car will equate to a decent deposit on its own. Then if you decide to finance another car, you'll be doing the exact same thing all over again.

With a lease, you're paying a monthly payment for a brand new car that you'll never own admittedly. However, you can & many do, lease a car that you simply couldn't afford to on finance. With a lease, you aren't bothered about depreciation or how much it'll be worth in years to come because it simply isn't your problem or part of the lease contract... You don't own the car after all. Also, it doesn't matter if it breaks down, a like-for-like car is usually provided by the lease company, repairs cost you nothing because the car is under warranty anyway, plus the road tax is usually already paid as part of the deal. Then you can add extras to the agreement like tyre cover for an additional premium - There's a lot to be said for a lease vehicle.

I guess the easiest way to work out whether a lease car is cheaper than finance is to look at the prices. Now for a fair comparison, you'd have to be buying a brand new vehicle on finance (The leased car will be brand new), so compare new with new. So factor in what the car costs to buy, how much your monthly payments will over each year (on finance), then what the car will be worth in future because depreciation is lost money. Then do the same for the lease, but remember, you won't be losing anything on depreciation because you don't own it. All you need to factor in for a lease vehicle is the monthly payments. Obviously, there's other running costs like insurance etc, but they don't come into this calculation as such. You're comparing the costs of a car on finance vs lease, not adding insurance, fuel etc up on top of it. If you want to do that, then by all means do.

Originally Posted by hrp123

I think warranty wise, although it the Volvo sponsored car care plan at £750 is much more than £260 at ALA - I would go with the Volvo one if I was keeping the car. They have an agreed dealer labour rate, so you shouldn't be out of pocket.

The problem with reading the fine print, is I don't know what exclusions are realistically problems that could happen... it seems a little pot luck with the 2015/16 cars. I don't think all the problems are mileage related e.g. I had my steering control module and a normal (not air) suspension start leaking - only with 32K miles.

The other issue I find is being unable to trust dealers in what consumables they tell you need to be replaced e.g. in January at Watford the car had an inspection and they said the front brake pads were 25% worn (in September just 1,200 miles later (we haven't been far during Covid times) - they say the brake pads are amber and 65% worn. The tyres were mysteriously 16% worn over the same period.

So absolutely, you pay more for a newer car - over the next three years, I reckon I would spend £3K more per year on the newer car vs keeping the older car - so it's not a small amount of money - but this would be for hopefully less stress and also I would do it only if I had air suspension on the new car.

Thanks for your thoughts!

Hopefully, owning a newer car will be less stress. That doesn't mean it won't give you trouble though. £3k is a lot of money... If anything was to go wrong with your existing car, that £3k would pay for a considerable amount of parts. Minus the cost of the Volvo warranty, that leaves you with £2,250 per year in your pocket.

I would keep your existing car personally. That's because I don't purchase expensive cars knowing that they're losing thousands every year. I buy older/used ones outright that have lost the majority of their value, but that's just my choice. If I wanted a brand new car, then the lease route is the one I'd take... It just makes more sense.