WOW - Made an enquiry via carwow to Lincoln Skoda to grab a vRS230 and part ex my vRS diesel estate in candy white.

 

- I had it originally on the popular 3yr 0% PCP deal, set at 15k miles per year, and I'm well within that (currently a shade under 40K)

- GFMV figure is 10.5K

- Current settlement figure (as of yesterday with 4mths to go) was £12,241.....

 

According to the dealer, I'm in negative equity - Looks like the 230 isnt going to happen and I handing back the keys in 4mths :(

I was the same as you, 0% 15k miles a year with a GFV of around £10.5k..... But I was already 17k miles over where I should be, it was on 55k and the PCP was to end in November.  Dealer valued it at £11500 and there was £11672 left to pay, with a bit of arm twisting I got them to just take i off me hands and clear the finance.  With your lower mileage I don't see why you can't come to some sort of deal...

You're probably right, they likely dont want the car....

My dealer did say (after the deal was done) that they can't shift used ones cos everyone is just buying them new.

I've never done a PCP, but from what I read on here I would have thought you were in a position to VT? With just over 12k left to pay on a vRS you must have paid more than 50%? Or is the vRS not as expensive as I thought (I may be thinking of the L&K figures I saw discussed)?

My dealer did say (after the deal was done) that they can't shift used ones cos everyone is just buying them new.

 Yep too many VRs around, they dont want them unless they are the right spec and cheap.

 

I expect they would sell for more privately, but you need to be prepared to wait and be messed around by some tyre kickers.

Another way to look at it...is its a very cheap 3 year old car, so why not finance or pay the GMFV and keep it a bit longer.

 

You know how its been treated, hopefully well.

 

Seems a waste to put so much money in and then walk away with nothing.

My vrs Tsi is not due till end of May. Ordered an SE to down size engine. I was around £1200 up. But major medical issues has caused me to cancel. All deposit refunded. So I have my wonderful Rally green Vrs Tsi estate sitting there looking at me????

This sounds to me like the unpleasant side of the popularity of PCH (lease deals), they are everywhere, and as a general rule cheaper than a PCP. The abundance of used cars hitting the used car market at 2 years old / 16,000 miles is making the PCP cars at 3 years old / 24,000 miles less valuable.

 

I personally can't see the benefit of PCP anymore, at least on Skoda's. It's biggest advantage was having equity in the deal at the end to roll into the deposit on the next new car. There are simply too many threads on here about the poor residuals on the MkIII Octavia resulting in negative equity.

 

Straight forward finance for those that want to own the car or a lease (PCH) deal for those that want to change cars more often seem to be the better options these days.

My dealer did say (after the deal was done) that they can't shift used ones cos everyone is just buying them new.

The problem has become so common that Skoda have now dropped the interest rate on used to 5.9% for upto 12 months and 7.9% for a 1-5 year old car. Used to be about 10%+ so wasn't competitive with 0% on new

Also giving 2 services for £139 and years warranty and years breakdown.

Quite simply PCP was over used 2 or 3 years ago to shift new cars, without much thought being given to what would happen to the increased numbers being handed back. If you have no equity, are free to hand back and start again with another brand. Has undone the ties to the brand when dealers don't want them as already have too many

I must admit my GFV is much lower than the ones I'm seeing here, so they've hopefully got a little more sane.

Either way however, if it's negative equity you make it the dealers problem and hand back the keys.

I must admit my GFV is much lower than the ones I'm seeing here, so they've hopefully got a little more sane.

Either way however, if it's negative equity you make it the dealers problem and hand back the keys.

Whats your spec? Is it lower because it was a 42mth PCP?

Unfortunately I think this Europe thing is affecting all "large"goods purchases where financial companies are involved. Houston markets almost at standstill. The importing car manufacturers don't want to do a deal now where come delivery time they are loosing money. Who can blame them. So the whole things a nightmare for the foreseeable future. Which means those at the bottom of the food chain suffer.

Are you suggesting Brexit is having an adverse effect on today's used car prices?

No the Money men are deliberately using it as an excuse to suit themselves as no one knows. Hell we ARE still in Europe. My opinion. I'm not go any further on that

Another way to look at it...is its a very cheap 3 year old car, so why not finance or pay the GMFV and keep it a bit longer.

You know how its been treated, hopefully well.

Seems a waste to put so much money in and then walk away with nothing.

That's exactly what I'm planning to do with mine; keep the bugger until it hits 80k-100k ????

Edited 2 August, 20169 yr by courty

That's exactly what I'm planning to do with mine; keep the bugger until it hits 80k-100k ????

 

Unless you're very lucky, the graph of cost-to-own versus age-of-vehicle rises exponentially after about five years.  Particularly when your next service necessitates a cambelt replacement.

Unless you're very lucky, the graph of cost-to-own versus age-of-vehicle rises exponentially after about five years.  Particularly when your next service necessitates a cambelt replacement.

£399 is hardly the end of the world for a cambelt, when you might be spending £250 a month or more on finance. Also when out of warranty use an independent garage to keep costs down.

If I just hand mine back after 42 months, I'll have wasted £11k, and have to start again. That works out at £3k a year. If I spent that over 10 years I could have a proper car for £30k!

Just step back and consider what you are spending guys. Its your money,but its a lot to just chuck away and hand the keys back.

If you really have to have a new car every 3 years get a PCH, its a bit cheaper.

But still if you were prepared to keep something for 10 years you could have a much nicer car.

Unless you're very lucky, the graph of cost-to-own versus age-of-vehicle rises exponentially after about five years. Particularly when your next service necessitates a cambelt replacement.

It probably will rise, however i'm sure based upon the JD power surveys of like the last 15yrs Skoda have always been up there and reliability wise I'm confident.

Once my PCP ends it'll only have about 40k miles on the clock so it'll have many miles left in its tank until I even contemplate a new motor.

I'll then be able to spend the finance money on something else; sweets probably ????

£399 is hardly the end of the world for a cambelt, when you might be spending £250 a month or more on finance.

 

I once tried to add up all the associated costs of owning and running a car, in order to compare several different makes/models. I quickly realised that (depending on your mileage) the two big costs are depreciation and fuel, and the rest of it makes for small differences by comparison. Since I normally keep a car until it's worth very little this distils (for me) into a comparison of purchase price and fuel economy.

 

I also like the idea that the depreciation shouldn't cost me any more than the fuel, and with my current mileage this equates to about £1800 a year. I bought mine for £14.5k, so if you assume I might get a couple of grand for it when it goes then I'm going to drop £12.5k, which means I need to keep it for at least 7 years (and something around 100k miles) to make this equation work, but ultimately I'll keep it until something really bad goes wrong with it (my last vehicle went when it had suspicions about the DPF, EGR and turbo simultaneously - not that I knew they'd all gone but it wasn't clear which was the problem and it was suggested a bit of trial and error was the only way to find out at a possible total cost of over £3k!).

 

Whether you consider £150 a month to buy a used car and keep it for 7 years as good value compared to a PCH is entirely a personal choice, although I'm obviously hoping to keep it long enough to reduce this figure further.

 

That or until I suddenly come into more money and buy something that smells of a mid-life crisis!

It seems pretty obvious that nobody who bought an Octavia on the original 3 to 4 years 0% deals is going to have any equity at all when it comes to the end of the deal. I would tend to blame Skoda for this as they obviously completely over estimated what the likely second hand value of these cars would be after 3 or so years. But it is really down to simple supply and demand, at launch the factory was working flat out and waiting times were longer than they currently are but then hire companies began buying large quantities of Octavia's at huge discounts, ran them for ten thousand miles or so and then sold them on to dealers like Motorpoint and Arnold Clark, who then can sell relatively new cars for incredibly low amounts. That has to knock long term residuals, no matter how reliable the cars actually are. And the current trend seems to be that PCH is now massively less expensive than PCP for buyers who want a new car every 2 to 3 years, as you are actually shielded from the worst effects of the substantial depreciation that the Octavia has suffered.

 

So the villain in this case is Skoda who chose to work their factory flat out for short term gain, without a single thought of what would happen to those of us who bought one of their cars on a PCP deal set against full retail price. The longer term situation is going to be a lot of angst as people are only now starting to realise that they can't easily trade these cars in and the only easy choices are to buy the car outright, if that is what you want to do or to hand it back and maybe buy something else on PCH instead. These PCP deals were completely mis-sold because as they were originally calculated they could never actually work in the way that they were supposed to, i.e. there could never be any equity and at some point these may give rise to compensation claims along the lines of Payment Protection Insurance (PPI). Personally, I think Skoda should do the decent thing and offer people who have been adversely affected by one of their PCP deals a minimum extra deposit contribution of £1000 (usable on PCP or PCH) over and above any other deals they are currently offering. It is usually harder to attract new customers than to retain existing customers but there are limits to what people will accept as reasonable if they feel ( as I do) that they have been unfairly treated by Skoda. I have mentioned this several times in other threads but to reiterate, when I bought my car the salesman was adamant that there would definitely be plenty of equity in the car at the end of the deal provided the car was in good condition and within the agreed mileage. 

So the villain in this case is Skoda who chose to work their factory flat out for short term gain

 

A lot of what you say seems logical, but I will make no comment on whether PCP was mis-sold, either morally or in law.

 

Whatever your opinion of the selling techniques though you can't blame them for filling the factory?! Every manufacturer of every product type in the world wants a full factory as, given the fixed overhead, anything else is commercial suicide.

I dont blame Skoda, I blame the salespeople.

 

At the end of the day, PCPs have a GFMV which is a safety net - They were sold heavily for too reasons:

 

- PCH / Leases were not in fashion, and too many people saw it as "throwing away money"
- Salespeople made more commission on PCP than PCH

 

For those that change their car on a regular basis (company car drivers with a car allowance, those who arent too fussy on build / spec etc, people who prefer a newer car etc), it is currently leasing which it the better option

It seems pretty obvious that nobody who bought an Octavia on the original 3 to 4 years 0% deals is going to have any equity at all when it comes to the end of the deal.

When I bought my car the salesman was adamant that there would definitely be plenty of equity in the car at the end of the deal provided the car was in good condition and within the agreed mileage.

The problem seems to be the salesman, not the product.

Without going off topic, if you have kept evidence, (written example he made, or a tape recording of the conversion) then you could look into filing a misselling claim. If not its your word against his, and he is bound to say he said you might have equity, not you will definitely.

Just don't use that dealer again if you don't like the result

I don't think anyone looks 42 months down the road?

 

I put £5k down (mostly the proceeds from the sale of my previous car) and was able to drive away a £24k car on 0%, with three years servicing chucked in, for £200 per month.

 

Plus I had a "safety net" in the form of a GFMV.

 

It was a no-brainer.