Buying outright - sensible or daft?
Discussion
I'm in the market for a cheap(ish) EV for commuting to school and work. It would be used, a couple of years old most likely. Ordinarily I prefer to buy cars outright but I'm concerned about the resale value of a 5 year old EV with various government incentives coming and going and battery technology moving forward. So, PCP looks an appealing option even at 8 or 9% APR. What would you do? Finance or cash?
I'm leaning towards the ID3 or the e208 currently.
I'm leaning towards the ID3 or the e208 currently.
I haven't and won't simply because of how quickly the technology is changing.
Not just batteries and motors, but in car tech too. Combined and you might well find the car is worth peanuts at the end of the term, and you're also more likely to want to move.
Now this might be entirely irrelevant with your car choice. Say it were a 2 year old Nissan Leaf, that no one buys for the tech, and you just want to use for the local 50 mile commute. It wouldn't matter to you if the entire world had moved on in a few years.
Or you could be tech savvy, and don't want a car that doesn't have the latest wizzy bits. You don't just do a short local commute and need something as efficient and rangey as poss. If it's the later rent it. If it's the former, buy it.
Just my 2p
Not just batteries and motors, but in car tech too. Combined and you might well find the car is worth peanuts at the end of the term, and you're also more likely to want to move.
Now this might be entirely irrelevant with your car choice. Say it were a 2 year old Nissan Leaf, that no one buys for the tech, and you just want to use for the local 50 mile commute. It wouldn't matter to you if the entire world had moved on in a few years.
Or you could be tech savvy, and don't want a car that doesn't have the latest wizzy bits. You don't just do a short local commute and need something as efficient and rangey as poss. If it's the later rent it. If it's the former, buy it.
Just my 2p
Not quite the same, but I'm looking at getting a 2021 Tesla Performance and was weighing up my options for funding it.
I've got about 5k equity in my current car so I'd looked at just trading it in and HP'ing the difference, however EVs seem to be losing value pretty rapidly compared to regular cars so I'm now looking at PCP with a minimal deposit - and investing the 5k. Doesn't seem to be worth the risk of owning it unless it's a cheap runaround.
I've got about 5k equity in my current car so I'd looked at just trading it in and HP'ing the difference, however EVs seem to be losing value pretty rapidly compared to regular cars so I'm now looking at PCP with a minimal deposit - and investing the 5k. Doesn't seem to be worth the risk of owning it unless it's a cheap runaround.
Other thing i should have mentioned is i need 5 doors to get a toddler in and out of the car seat easily, so the Fiat 500s and Minis are no use.
I have a petrol car so will never do more than about 50 miles in a trip in the EV, but i wonder when it comes to resale time if having a low range car like the Honda E (which i love) would make it impossible to get rid of.
I have a petrol car so will never do more than about 50 miles in a trip in the EV, but i wonder when it comes to resale time if having a low range car like the Honda E (which i love) would make it impossible to get rid of.
Hello everyone,
I'm also thinking about joining the EV community and saying goodbye to my trusty 10-year-old F20. My budget aligns closely with the original poster's, though it's easy to exceed. I've done some research on overall costs and compiled a list of cars below, including ownership expenses over 12 and 36 months.
I've based the EV charging rates on my current Octopus average tracker rate, rather than opting for a dedicated EV tariff with potentially higher daytime rates. For comparison, a lower kWh rate of £0.07 would amount to £105 for the year.
Insurance costs are nudging the Tesla out for me (mid 50's with clean licence).
Any thoughts or suggestions would be greatly appreciated.
I'm also thinking about joining the EV community and saying goodbye to my trusty 10-year-old F20. My budget aligns closely with the original poster's, though it's easy to exceed. I've done some research on overall costs and compiled a list of cars below, including ownership expenses over 12 and 36 months.
I've based the EV charging rates on my current Octopus average tracker rate, rather than opting for a dedicated EV tariff with potentially higher daytime rates. For comparison, a lower kWh rate of £0.07 would amount to £105 for the year.
Insurance costs are nudging the Tesla out for me (mid 50's with clean licence).
Any thoughts or suggestions would be greatly appreciated.
CLK-GTR said:
Other thing i should have mentioned is i need 5 doors to get a toddler in and out of the car seat easily, so the Fiat 500s and Minis are no use.
I have a petrol car so will never do more than about 50 miles in a trip in the EV, but i wonder when it comes to resale time if having a low range car like the Honda E (which i love) would make it impossible to get rid of.
Honda-E was a low volume niche product in the first place to new buyers, of which most seemed to be in London. I have a petrol car so will never do more than about 50 miles in a trip in the EV, but i wonder when it comes to resale time if having a low range car like the Honda E (which i love) would make it impossible to get rid of.
If you love something like a Honda-E (life is so short, why overthink your purchase!) then get it as long as you are comfortable that it may take longer to sell in x years time given the minority of used car buyers who would be looking for something like that.
CLK-GTR said:
I'm in the market for a cheap(ish) EV for commuting to school and work. It would be used, a couple of years old most likely. Ordinarily I prefer to buy cars outright but I'm concerned about the resale value of a 5 year old EV with various government incentives coming and going and battery technology moving forward. So, PCP looks an appealing option even at 8 or 9% APR. What would you do? Finance or cash?
I'm leaning towards the ID3 or the e208 currently.
A finance deal doesn't avoid the cost of depreciation, it only avoids the cost of unexpected depreciation. The financier will have an expected residual value for the car at the end of the deal and will charge you the difference spread over the term, to cover their costs. The benefit is that if depreciation turns out to be steeper than they expect, it's their problem not yours.I'm leaning towards the ID3 or the e208 currently.
However in this case we're talking about buying a car that has already suffered heavy depreciation from its new list price. So they aren't that expensive to buy in now, and there's no particular reason to expect a further big loss of value.
On that basis I bought an e-C4 for £14k last Nov outright. I'm aware it will depreciate being a newish car, but if it's worth half that in 3-4 years time, I'd be ok with that.
Old Leafs and things are still useful as local runabouts, so I don't see these sort of cars becoming entirely worthless.
samoht said:
Your EV costs look £1k too high to me, as if you've got the charger in there twice.
eg ID3 should be annual cost of £500 ins + £285 electricity + £150 maint = £936
Three year cost = £936 x 3 = £2807 + £1000 charger + £800 tyres = £4607 (not £5607)
Well spotted!eg ID3 should be annual cost of £500 ins + £285 electricity + £150 maint = £936
Three year cost = £936 x 3 = £2807 + £1000 charger + £800 tyres = £4607 (not £5607)
Note to self, no thinking after pub lunch.
I opted for an ID3 on PCP. Bought from a maindealer which got me two years free warranty, free servicing, MOT cover (covering repair bills for faulty items) and roadside assistance. I extended the warranty for a further year for £440.
I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
Edited by chunkyjh on Saturday 13th July 08:37
chunkyjh said:
I opted for an ID3 on PCP. Bought from a maindealer which got me two years free warranty, free servicing, MOT cover (covering repair bills for faulty items) and roadside assistance. I extended the warranty for a further year for £440.
I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
This is what I'm thinking. It only takes one greedy politician to dream up some new EV tax or a breakthrough in tech and your value falls through the floor.I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
Edited by chunkyjh on Saturday 13th July 08:37
CLK-GTR said:
This is what I'm thinking. It only takes one greedy politician to dream up some new EV tax or a breakthrough in tech and your value falls through the floor.
In the context of a stable government committed to net zero, and stalling EV market uptake, I think significant new financial disincentives for EVs are rather unlikely.Any new tech will come in at the high end first, a brand new superbattery-powered EV isn't going to be in market competition with your ~£10k five year old model.
It's certainly true that a finance deal protects against unexpected external shocks, and it's a reasonable choice if you want certainty, and that EVs had a big sudden drop last year, but I don't see any basis to anticipate further big falls from their already-depressed values.
We’ve got a Honda ENY1 from one of the very cheap PCP deals in March. There are some deals back out there now but not quite as good, think c£250pm.
Brand new car with 5 years warranty and servicing.
Dynamically it’s not amazing but for a family school/ shopping/ wife commute car it’s brilliant. Used for 90%+ of our run of the mill mileage now.
It’s a 5 door with very good internal space so good for kids. Boot space not great but not a disaster.
Brand new car with 5 years warranty and servicing.
Dynamically it’s not amazing but for a family school/ shopping/ wife commute car it’s brilliant. Used for 90%+ of our run of the mill mileage now.
It’s a 5 door with very good internal space so good for kids. Boot space not great but not a disaster.
chunkyjh said:
I opted for an ID3 on PCP. Bought from a maindealer which got me two years free warranty, free servicing, MOT cover (covering repair bills for faulty items) and roadside assistance. I extended the warranty for a further year for £440.
I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
The optional final payment on similar ID.3 deals does like high at around £8K (car I looked at would be 8yrs old with 90K at the end of the 4yr PCP). The £4K charge for credit is painful though.I figured my payments would probably not cover the depreciation from £16k. Insurance is £300 a year for me, Conti tyres are suggested to last 20+K miles judging by general feedback on FB group. Approx £200-300 in electricity to drive 8000 miles. all in very cheap to run.
At this price point I wouldn't buy. Maybe a 4-6k leaf for short journeys but anything more I don't want to own. I'll be handing this one back and walking away, if there is any equity remaining (unlikely) I may roll that forward.
My ID3 (2020) 50k miles has a real range of around 220 miles. I usually charge to 80% and get 180 miles. More than enough in my circumstances. It rides and drives really nicely, very comfortable, well equipped (family package) and nippy when it needs to be.
I'm agonising over what to do for a family member who does 20K miles per year and is spendng £250/mth on petrol. Wants a FWD SUV(ish) and current thinking is to outright buy something like 2-3yr Hyundai Kona (as approved used are warranted for 5yrs) for high £teens and assume it'll be worthless after 5yrs.
I'm against borrowing money at a rate of interest to buy something that depreciates.
Myself and many thousands more in the UK just pay outright for used cars. There are some great used buys now, and the 'old tech' argument isn't really a thing unless you count the Leaf with its uncooled battery.
Mine was 3 years old when I bought it, and the past 3 years have been trouble-free.
Myself and many thousands more in the UK just pay outright for used cars. There are some great used buys now, and the 'old tech' argument isn't really a thing unless you count the Leaf with its uncooled battery.
Mine was 3 years old when I bought it, and the past 3 years have been trouble-free.
I'd posted another thread recently about EVs in the £10-15k range, where you can get 2-3 year old cars for way less than a new vehicle.
At that price I wouldn't be worrying too much about finance or residual values. If the car meets your likely needs in terms of size and range you could easily run it for 7 or 8 years, saving a decent amount vs petrol/diesel, and can only lose so much in terms of depreciation.
If it's worth a few thousand at the end then that's really cheap motoring (and you can look at Leaf prices for an idea of what that floor might be).
At that price I wouldn't be worrying too much about finance or residual values. If the car meets your likely needs in terms of size and range you could easily run it for 7 or 8 years, saving a decent amount vs petrol/diesel, and can only lose so much in terms of depreciation.
If it's worth a few thousand at the end then that's really cheap motoring (and you can look at Leaf prices for an idea of what that floor might be).
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