I'm pretty much at that point now, but am considering for the first time buying a new car from the main dealer, namely the Kia Sportage hybrid.
Do people generally have much success in haggling with main dealers in the same way that you can with the used car market? Or is it a case of you basically pay the list price?
Apologies again, I am not frequently changing cars and don't know an awful lot about the market.
In order to advise correctly I'd ask how long do you typically keep your cars for, and if this is brand new are you planning on keeping it longer?
Dealers will want to sell you a car their way, so they'll prefer to get you on the PCP merry-go-round where you trade in your current car as a deposit, and they give you a low(ish) monthly payment for the balance of the car value (on a higher interest agreement) for 24/36/48 months then a GFV/balloon payment at the end, which is typically going to be more than the car will be worth. They'll leverage this after 18-30 months by calling you up asking if you'd like to trade in your current vehicle for another new one for the same cheap(ish) monthly payment.
On Kia's website the deal for the following car - New Sportage 'GT-Line S' 1.6 Turbocharged Petrol Manual -
36 monthly payments of
£373.38
Customer Deposit
£8,000.00
Deposit Contribution
£1,500.00
Total Deposit
£9,500.00
On The Road Price
£36,270.00
Amount of Credit
£26,770.00
Interest Charges
£3,915.53
Optional Final Payment
£17,243.85
Total Amount Payable
£40,185.53
Fixed Rate of Interest
3.04% p.a
Duration of Agreement
37 months
Annual Mileage
10,000
Excess Mileage Charge per mile
9.0p
Offer Price
£36,270
Representative APR
5.9% APR
So you are paying £21,441 to have the car for 36 months, and at the end you'd have to pay £17243 to keep it, making the total cost to you - £38,648.
On NCD they have a similar model for £30,909
New UK KIA SPORTAGE ESTATE 1.6T GDi HEV GT-Line 5dr Auto with best discount in the UK. Choose specification and manufacturer options to suit you
www.new-car-discount.com
with the same £8,000 deposit the cost is £290.78 per month for 36 months on 7.9% apr representative, total cost for 36 months is £18,468 with a GFV of £17,343, making the total cost to you if you keep it £35,811
If you have no interest in keeping it, then you could get a KIA Sportage Estate 1.6T GDi HEV GT-Line 5dr Auto on a PCH deal for 36 months on a 1+35 with 10k miles PA (same as the ones above) for £368.09 per month, or TCO of £13,251, a rather large saving of ~£8k over the KIA website or ~£5k from the NCD price. There is no option to buy at the end.
You could also look at the KIA EV4 Hatchback 150kW Air 81kWh 5dr - £447 a month on the same 1+35, 10k miles per year. More per month but if you use all the 10k miles per year and can charge at home you'd save up to £3,500 on petrol based on todays prices at 50MPG. So TCO becomes £12,592 for 36 months with fuel savings.
You could also look at the opportunity cost of the current car, if you sold it rather than trading it in and I am just assuming it is worth £8000 here, as I have done throughout. If you put that in a normal regular saver account at 4.5% and drew down the monthly payment of £447, you'd have made £296 interest and the £8000 would have been depleted by the 20th month.
Best way to look at the cost is in the end is how long you want to keep it and your total cost of ownership for that time, and obviously if you can lower the upfront cost that is ideal so shop around and don't be afraid to travel to collect! (or pay to have it delivered).
