Having now placed an order for a Superb SE Business Estate via a lease company i'm just wondering how the heck they can be offered so cheap? I've seen a number of offers now that mean you can effectively get a very nicely equipped big barge of a Superb for less than the cost of some Ford Fiesta/Focus deals. Considering id loose probably around double in depreciation if I actually bought the vehicle in question i'm curious to understand how this is possible so could anyone enlighten me?  

Edited 10 November, 201510 yr by SuperSuperb

Speaking as someone who's been waiting for 3 months it's probably because you'll never actually get the damn car!

Speaking as someone who's been waiting for 3 months it's probably because you'll never actually get the damn car!

 

I did wonder about times etc but to be fair, they've been very good so far. I got an email the moment the order was placed with the dealer and confirmation of the expected build time. I don't really need any more at this point but I guess we'll see if the build date moves around over the coming weeks. 

At sky high level, the leases will be funded by internal and external investors, giving loans to the likes of VW FS.

 

- Lets say a car is £30k new on the street. Due to the bulk/guaranteed buying arrangements, a FS company can "buy" them for £20k.

- A car is then leased out for two years at £250pm (equivalent), of which £180pm filters back to the financial services company.

- Assuming 15% p.a. depreciation, its sold after 2 years for £21,675. Lets allow for some tax and costs and call it a round £20k.

 

The FS company has made 10% per annum on its investment and the car company has made a number of guaranteed sales (and still likely made a profit)

At sky high level, the leases will be funded by internal and external investors, giving loans to the likes of VW FS.

 

- Lets say a car is £30k new on the street. Due to the bulk/guaranteed buying arrangements, a FS company can "buy" them for £20k.

- A car is then leased out for two years at £250pm (equivalent), of which £180pm filters back to the financial services company.

- Assuming 15% p.a. depreciation, its sold after 2 years for £21,675. Lets allow for some tax and costs and call it a round £20k.

 

The FS company has made 10% per annum on its investment and the car company has made a number of guaranteed sales (and still likely made a profit)

That's interesting and the understanding I was after. Thanks. I figured over two years Id probably loose the best part of 35% so not too far away from your figure of 15% per year. So using the lower 15% pa figure on a new 25k car you'd be looking at a lose of around £7500 so paying less than £4800 in lease charges for the same period just seemed to make a lot of sense. Its my first lease so its a learning curve for me. 

Also the leasing companies never pay "the price" which is where and why they have a lot of leverage. As they will be buying in bulk they will be I guess getting a bigger discount than any dealer who do not or cannot order as many over the year or I could be not for the first be talking out of my rear end.   

The SE business has a pretty low list price as well, circa 22k. Assuming the lease co gets these for approx 17/18k and it's still worth 15k after two years.....

dont forget that "leasing companies" are only really brokers sourcing what offers the manufacturer's financial services company decides to fund 

hence why limited editions or very specific models can work out super expensive as they are probably financed externally (even though they may be lower spec).

Thing to note is it is also not about the purchase price but the depreciation - a higher quality car is going to lose less money than a 'cheaper' car. Our O3 scout was £100pm cheaper than the £10k less fabia mk3. 

The SE business has a pretty low list price as well, circa 22k. Assuming the lease co gets these for approx 17/18k and it's still worth 15k after two years.....

I specified mine with Canton and no other options as I like my audio (it has metallic as standard, probably to help residuals) but I wasn't prepared to add anything else due to costs - in estate form I think it's just over 24.6k. They sent me an option to do 'return to invoice gap cover for the two years' and on that paperwork I noticed they stated their purchase price as £19,000 - not sure how accurate that is but I guess it's right?

Thanks for the explanations guys.

Which leasing company was it ? Considering purchasing a MK3 Superb.

Which leasing company was it ? Considering purchasing a MK3 Superb.

http://www.freedomcontracts.com/car-leasing/ From £99 per month but I had to go with £119 per month due to it being a personal purchase (not a business one) - cheapest I could find by around £30 per month. Be aware that any options are fully paid for throughout the lease period so I didn't get carried away.

I don't have exact cost figures but my Company car scheme is Vauxhall insignia SRi 160bhp or Superb SEL (I've just got a 190bhp estate), I presume the leases cost about the same indicating the Skoda is cheaper to run.

 

Remember we partly pay tax on the list price of the car not what the lease company pay.

 

It used to wind me up that I was taxed at £27k or whatever for my last Vauhall as nobody has ever paid anyway near list for an Insignia.

 

If they did they should have their Liscence taken off them as they are unfit to drive.

At the moment there are some cracking deals on the new Superb. Skoda obviously trying to muscle their way into the business lease market with huge discounts, Citroen did a similar thing a few years ago with the C5 and failed, although the car was very good. As stated earlier a combination of factors make the current Superb a good deal on lease.....the downside is delivery time. Mine is now well into 2016, but I still think it's worth waiting for. The only niggle is after December you fall outside Q4 deals and who is to say there won't be better deals in the New Year. All you can do is go for the best deal you can at the price you want. Mine is on a 3X47 deal, with a bunch of extras and a price I'm happy with. 

 

What amazes me is why anybody looking at a personal lease would go anywhere near a dealership when you can get a far better deal through a lease company. Add a few extras to the SE Business model and you can almost exceed the level of the SE Executive at a much reduced price, it's a no brainer. I was told by a dealer the SE Business in not available to individuals, well they are if you go through a lease company. Every lease I have had I have been approached by the company with an option to buy before returning.        

 

The big factor is the finance covers the depreciation, the residual value in the car is owned by the finance company, and it's predicted the new Superb will be low depreciation, coupled with this is the high spec of the SE Business model, and the relatively low price. Lease companies work on bulk buying and get huge discounts which aren't available to Joe Public. 

At the moment there are some cracking deals on the new Superb. Skoda obviously trying to muscle their way into the business lease market with huge discounts, Citroen did a similar thing a few years ago with the C5 and failed, although the car was very good. As stated earlier a combination of factors make the current Superb a good deal on lease.....the downside is delivery time. Mine is now well into 2016, but I still think it's worth waiting for. The only niggle is after December you fall outside Q4 deals and who is to say there won't be better deals in the New Year. All you can do is go for the best deal you can at the price you want. Mine is on a 3X47 deal, with a bunch of extras and a price I'm happy with.

What amazes me is why anybody looking at a personal lease would go anywhere near a dealership when you can get a far better deal through a lease company. Add a few extras to the SE Business model and you can almost exceed the level of the SE Executive at a much reduced price, it's a no brainer. I was told by a dealer the SE Business in not available to individuals, well they are if you go through a lease company. Every lease I have had I have been approached by the company with an option to buy before returning.

The big factor is the finance covers the depreciation, the residual value in the car is owned by the finance company, and it's predicted the new Superb will be low depreciation, coupled with this is the high spec of the SE Business model, and the relatively low price. Lease companies work on bulk buying and get huge discounts which aren't available to Joe Public.

I leased through the dealer and it was by far the cheapest offer at the time. It still compares better to any lease I can find elsewhere currently incl freedom contracts detailed above.

I leased through the dealer and it was by far the cheapest offer at the time. It still compares better to any lease I can find elsewhere currently incl freedom contracts detailed above.

If you have a good deal through a dealership then you have done well, maybe it was a bit of a sweeping statement from me but in the main I would say dealership deals cannot match lease companies, they usually want a hefty deposit and certainly when I talked to my dealer he told me I couldn't get the Business SE model anyway  

If you have a good deal through a dealership then you have done well, maybe it was a bit of a sweeping statement from me but in the main I would say dealership deals cannot match lease companies, they usually want a hefty deposit and certainly when I talked to my dealer he told me I couldn't get the Business SE model anyway

The original offers were for the SE business to only be available for business users, so no VW/skoda personal leases but that changed in early July I think. Don't get me wrong I had to work hard to get the deal as despite it being available officially from skoda through all dealers two of my local ones refused to honour it. Apparently as they purely get a vehicle supply fee circa £350-£400 so it wasn't worth their effort.

You're right though on the hefty upfront deal. Mines based on a 9+23 deal so have to stump up in the first month. Still good value over the 24 month term though. All the cheaper deals I've seen are based on 8k mileage with a hefty xs mileage rate.

The original offers were for the SE business to only be available for business users, so no VW/skoda personal leases but that changed in early July I think. Don't get me wrong I had to work hard to get the deal as despite it being available officially from skoda through all dealers two of my local ones refused to honour it. Apparently as they purely get a vehicle supply fee circa £350-£400 so it wasn't worth their effort.

You're right though on the hefty upfront deal. Mines based on a 9+23 deal so have to stump up in the first month. Still good value over the 24 month term though. All the cheaper deals I've seen are based on 8k mileage with a hefty xs mileage rate.

wasnt that Skoda deal set to 7.2p per excess mile also? The Freedom deal was by far the cheapest I could find after three weeks of looking. Previous to this it was Simpsons Skoda that were cheapest at £149 per month with £1990 up front. If you are comparing business deals then the Freedom deal is £99 x23 for the Superb SE Business... That's CHEAP! They have deals from 8k per annum up to very high annual mileages. Personally, I'll probably struggle to do the 16k over two years so it suits me well and if I manage to do more, it's cheap enough to pay off the mileage balance.

wasnt that Skoda deal set to 7.2p per excess mile also? The Freedom deal was by far the cheapest I could find after three weeks of looking. Previous to this it was Simpsons Skoda that were cheapest at £149 per month with £1990 up front. If you are comparing business deals then the Freedom deal is £99 x23 for the Superb SE Business... That's CHEAP! They have deals from 8k per annum up to very high annual mileages. Personally, I'll probably struggle to do the 16k over two years so it suits me well and if I manage to do more, it's cheap enough to pay off the mileage balance.

It's a personal lease for me. The Simpsons skoda deal was the VW backed deal, that's what I used to get the same deal by one of my local dealers. With upfront cost, monthly charge plus xs mileage of approx 10k over two years it comes in at £6327. The same spec and mileage with freedom comes in at £6535 over 24 months.

Edited 10 November, 201510 yr by Bugginbob

I think most of the deals must be from the same finance company, just different brokers as the total prices are almost identical when you factor everything in.

I think most of the deals must be from the same finance company, just different brokers as the total prices are almost identical when you factor everything in.

I think you're right there, when I first saw the prices on Freedom I thought they were a better deal than mine but factor in a similar deposit, mileage and term and they all start to look the same. I've gone for a 3x47 with added extras of nearly 3k yet it's only added 51 a month which is where I think I've got a good deal. In the past I've returned my leases but this one if like it I might decide to keep it.

 

The bottom line is if you are getting a lease within a couple of hundred pounds of Freedom over the full term you're getting a good deal and the big win is on the SE Business model compared to the SE and SE Executive model. You can spec up the Business model beyond the SE Executive and it still works out cheaper.       

. In the past I've returned my leases but this one if like it I might decide to keep it.

 

 

You have the choice to keep a lease car at the end of the period?! 

i dont believe it is a choice, on occasion you might get offered the chance to buy it outright or extend the lease.

i dont believe it is a choice, on occasion you might get offered the chance to buy it outright or extend the lease.

Yes, that's how its been described to me by the local dealer and Freedom. Lease extension could be a viable option if I end up liking the car I guess and it would still be under warranty until the end of year three.

 

I'm also assuming that if the car was to go back at 16k/two years and it wasn't asking for a service, this would be done at their cost after handing the car back! Tyres should also work out to be at their cost as I'll be running my own winters for half the time the car is with me so the OE tyres shouldn't need replacing either! Well, that's the hope anyway! 

i dont believe it is a choice, on occasion you might get offered the chance to buy it outright or extend the lease.

Speaking from experience of the 4 previous lease cars I have had since 2006, all from different companies I was offered 2 at the end of the lease, I extended one and ended up buying it, and the 4th I enquired about and was offered a price. So it might not be something they admit to, or encourage but in reality it happens.

 

I guess from the lease point of view if they can get a sale they don't need to pick up and pass on, I know for a fact one car I had was going straight to the auctions.