Company Cars, leasing, buying 2nd hand

<(Multi)>

<(Multi)>

<(Multi)>

Associate
Joined
1 Aug 2004
Posts
1,306
Location
South Cheshire
On the 1st January 2009 my colleague and I take over the company we currently work for as CCTV field engineers. We're paying our employer off over 12months to the sum of 40k so as you can imagine moneys going to be tight.

Problem is, we're rejecting his cars; Golf TDI and Saab 93 estate as they've got too many miles on (120k and 90k) as we rack up 60-80k a year.

First issue I've found is no lease company will give you 60k a year, so I'm left wondering how to go about leasing. My second thought was due to this huge mileage, surely it would be better to buy an estate car second hand and then sell it 6 months on with only an extra 30k on. But buying second hand means we need to take finance for approx £10k (each) over 3 years, so we're likely to get into the trap of paying ever more interest when the car hits a price lower than the outstanding finance deal.

Basically, what I'm wondering is; has anyone got any experience of high mileage business use. Leasing companies for 60k+ a year? Or have people bought cars 2nd hand and taken the deprication on the head every 6 months. (Im guessing if we bought 2005 Accord estates for £10k with 30k on the clock from a dealer, in 6months with 60k on the clock we'd have a trade in price of £5.5-6k?) seems VERY experensive

We've been looking at 2005 reg Honda Accord estates as 2nd hand cars - though thats just a preference really, we're going to have to look at others Im sure (any ideas?) Leasing wise, we just need something in the same class as an Accord or Volvo V50 really. We're budgeting £350 a month (hopefully) (per car)

Any ideas guys?? Thanks D
 
Last edited:
How important is it to have new cars?

If its not just get some decent estates and run them into the ground.
 
dsb said:
How important is it to have new cars?

If its not just get some decent estates and run them into the ground.
Click to expand...

We're not allowed to have cars older than 5 years old - we're sub contractors for a major company. This is whats making the task so difficult :(
 
However you do it, you're going to get hit with a huge loss in value because of the miles.

But a 30k mile 2005 Accord for £10k? That's a rip off.

I'd buy a 2nd hand 2-3 yr old car with above average mileage and run it to mega mileage. It'll cost you a bit more parts maybe but once you get above 120k the mileage (in terms of depreciation) becomes irrelevant.
 
Im not sure if running a car for 5 years is really an option though, the mileage is so high (60-80k a year) after 5 years thats at best 350K+ more than likely 450K+

The 10K Accord estate was from a Honda dealer and was their cheapest too :(

Does anyone know the reliablity rates for the 2.2 Diesel Accords? We've had Golfs for the last three years and they've blown 1 engine and 2 turbo (thank gob within warrenty) Buying second hand with the same failure rate would result in £5-7k worth of expense.
 
I dont think there is really any way you can run cars for 60k miles a year for just £350 a month. Whichever way you do this its going to cost you a considerable amount of money.
 
[TW]Fox;12476703 said:
I dont think there is really any way you can run cars for 60k miles a year for just £350 a month. Whichever way you do this its going to cost you a considerable amount of money.
Click to expand...

Yeah, I think you're right.

Saying that, after the first year the company will be £3,333 a month better off as my now current employer will have been paid off. The budget for the second year of lease/finance could easily be £600-700 a month without issue. I suppose the real problem is getting through the first year financially okay.

Any ideas on the most cost effective way of getting through this first year? Leasing is going to sting due to the short contract length and the high mileage, maybe this is where we buy 4 year old base models for cheap and hope to god they dont die on us... hmmm
 
Why not look at purchasing the Saab off of the current owner?

It's current mileage is only equivilant of a single years use. After you've paid him off you'll likely have a working Saab (my friend drives a 200k 95/93 which has only needed a new turbo in all of those miles!) with 150k. Worth ~£1.5k and would have had the years use out of it for hopefully little charge, much less than buying something else or leasing.

To me, in your financial and business position, it makes more sense to put 60k on a 100k car than a brand new car.

After this first year. I'd recommend you look into other options.

(Edit- Possibly buy a second Saab so you have a "fleet" of the same car?)
 
Last edited:
Go down the Skoda route and buy brand new "taxi driver specials" with none of the trimmings but rock bottom price and then run them for five years? Not nice but should provide decent value.

Or....

Buy 4year old ex rep mobile Mondeo, Octavia or C5 etc etc at £4000, run it for a year. That means the car costs £333 per month. Unfortunately that will not cover servicing, failures and tyres. After a year sell the car for whatever you can get for it. Hopefully that will cover the maintenance costs paid out during that time. Of course the best way to avoid them breaking down is to drive them carefully and not stress them out too much. (Easier said than done I will admit). The cars you can buy for £4000 are not going to be old particularly and should be reasonably reliable. I presume most of the miles you do are motorway?

Could you and the other new director take personal loans over a couple of years and or so and lend the company the money for the new vehicles that way? Or since you are directors buy the vehicles personally (thus avoiding company car tax) and claim expenses back from the company? Of course you couldn't take 40p per mile because you would be claiming £24,000 travel per year on a 60k mileage!

My choice would be to go for 4 year old mondeos to be honest. But then again I would be doing all the oil changes and normal easy service items myself on an evening.

The only other idea I have is "faking 5 year old cars". Buy older Accords but still new shape and stick cheap personalised plates on them! Seems a bit daft to breach your contract for the sake of buying the correct vehicle tho.
 
Last edited:
mattpc said:
Go down the Skoda route and buy brand new "taxi driver specials" with none of the trimmings but rock bottom price and then run them for five years? Not nice but should provide decent value.
Click to expand...

I'd second that I've been in Octavia taxi's that were still going strong with around 250k on the clock so i'd definately look into this, or any of the other taxi driver specials if they are used as taxi's it's for one reason only they go forever.
 
a1ex2001 said:
I'd second that I've been in Octavia taxi's that were still going strong with around 250k on the clock so i'd definately look into this, or any of the other taxi driver specials if they are used as taxi's it's for one reason only they go forever.
Click to expand...

This is partially true but some (particularly older private hires) are purely used because they are cheap end of story!
 
If you're going to be in the field with lots of kit in the car, pick up a couple of Citroen C5 HDi estates - absolutely cavernous boots, very comfortable for long journeys and cheap to run. Father has had two and they've really been great, very cheap to buy too - could probably find a couple with 40k on the clock for about £6000...
 
You could always hire an estate & on your own Insurance the costs wont be too high + mileage probably wont be a factor.
Add to that if you go a reputable hire company then the vehicle will be newish & they'll always keep it tip-top.
 
I used to work for a company who did those miles in a Vito & the mileage was not an issue.

You gotta work out the costs of a hire car vs buying & Id guess with a high mileage its cheaper to hire.
 
Putting 60,000 miles on a car is going to NUKE its residual - hire companies rely on a reasonable residual value for their business model to work. They wont rent you a car to do 60,000 miles in over a year and the few that do will charge you dearly. I cannot remember the last hire car I drove that had more than 5000 miles on it or didnt have a sticker insisting it went back at 10k miles or 12 months, whicheve was soonest.
 
FirebarUK said:
If you're going to be in the field with lots of kit in the car, pick up a couple of Citroen C5 HDi estates - absolutely cavernous boots, very comfortable for long journeys and cheap to run. Father has had two and they've really been great, very cheap to buy too - could probably find a couple with 40k on the clock for about £6000...
Click to expand...

More like £4000 at 40k on an 04 plate according to parkers.
 
You must log in or register to reply here.
Back
Top Bottom