Thanks to everybody for the opinions on Xenon lights. I am changing a 59 plate Octavia 4x4 with Maxi dot rear parking sensors and 4 spoke steering wheel with audio controls, and 14000 on the clock. The part exchange price for a new Octavia 4x4 with extras is £13000. This sum has been guaranteed in writing for the length of time it takes for the new vehicle to appear which could be 6 months and another 5 thousand miles which is a pretty good deal I think.

Channel

Just out of curiosity why are you swapping your current nearly new 4x4 for another?

I imagine that your current car has depreciated quite a bit since new, seems a shame to spend another £13K on an identical car and loose all that money?

Hi Silver1011, having re-read my previous post I realise that it was not as written as it should have been. My current Octavia estate is a 59 plate with 14000 on the clock with some optional extras. It was originally bought new for £15995 as the deal at the time was that the amount of VAT 17.5% would be removed. Currently the offer is "only pay 5% VAT") providing that the order is made before June 30th. Therefore I have been offered £13000 which has been guaranteed until the new car turns up which could be 6 months and or 5000 miles. So there has not been that much depreciation and the new Octavia is list price but only 5% Vat. Which means that it is around £5000 to change. Keep the original for 4 years and you would have to find around £15000 to change.

Channel

The heaviest depreciation year for a car is the first year of ownership so going through this twice in a 4 year period is going to end up costing you more than keeping the one car for 4 years.

Now in 4 years you will probably still get £6k or maybe more for your current car so using the current price as a basis you will only need to pay £12 to upgrade. Now you are putting in £5k now and saying you trade in in 3 years so worth around £8k you still need to put in £10k to change hence a total spend of £15k.

Unless on a hire purchase scheme (and their are times that you can trade in after 18 months and get the same car for less per month) then there really never makes any sense to buy a new car (that is the same) from a financial point of view.

If you just want a new car then that is great but do not kid yourself that you will save money by doing it.

I take your point regarding depreciation, but you are using current figures. Should I keep the vehicle for 4 years it would probably be worth as you suggest between £6k to £8k. The new vehicle would have gone up in price by around at least £1k and there is no guarantee that the current deal of 5% VAT would still be in place. If there is no VAT deal in place, that would add another £3600 to the price (assuming there isn't another hike in the VAT rate). In addition the car would be out of warranty, there would be a MOT to pay for and probably the cost of new tyres on all round as it is a 4x4, plus the cost of a service. Not to mention the Diesel Particulate Filter and the Dual Mass Flywheel, both of which have been known to cause problems when out of warranty.

John