rjgreen4 Posted March 14, 2007 Report Share Posted March 14, 2007 Anyone have any ideas after 3 yrs and 60k miles Link to comment Share on other sites More sharing options...
Chins Posted March 14, 2007 Report Share Posted March 14, 2007 On a new one, I got £13,300 on a finance agreement - 30k miles though Link to comment Share on other sites More sharing options...
gizze Posted March 14, 2007 Report Share Posted March 14, 2007 I was only being offered £13K after 3 years too. Link to comment Share on other sites More sharing options...
Chins Posted March 14, 2007 Report Share Posted March 14, 2007 £13.3k for me was a very good figure on a car that cost £28k. I was being offered no more on a similar spec TT. Shows how strong they see the residuals on the S3. Put 10% down and £449 a month for 3 years. Car should be worth about £15k in reality, so £13k depreciation in 3 years is good. One of the car I bought for a guy at work last year- 320d worth £24k was getting underwritten for £16k at 8 months old. Now I know why contract hire is the only way with BMW's. Link to comment Share on other sites More sharing options...
David Wilson Posted March 14, 2007 Report Share Posted March 14, 2007 Managed to get £12.8K on a just over 4 year old S3 with 40K on the clock against a new S3, however that was back in October Link to comment Share on other sites More sharing options...
rjgreen4 Posted March 15, 2007 Author Report Share Posted March 15, 2007 The S3's don't seem to be holding their values as well as other cars in their field. The R32 I have just picked up is bog standard and based on a list of just under £25k they are offering me £15.5 based on 20k per annum and 3 years old. Why are the residuals different? I would have thought it would be the other way around. Link to comment Share on other sites More sharing options...
rjgreen4 Posted March 15, 2007 Author Report Share Posted March 15, 2007 [ QUOTE ] The S3's don't seem to be holding their values as well as other cars in their field. The R32 I have just picked up is bog standard and based on a list of just under £25k they are offering me £15.5 based on 20k per annum and 3 years old. Why are the residuals different? I would have thought it would be the other way around. [/ QUOTE ] And that was VW finance, obviously at the end of the term I can hand the car back Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] £13.3k for me was a very good figure on a car that cost £28k. I was being offered no more on a similar spec TT. Shows how strong they see the residuals on the S3. Put 10% down and £449 a month for 3 years. Car should be worth about £15k in reality, so £13k depreciation in 3 years is good. One of the car I bought for a guy at work last year- 320d worth £24k was getting underwritten for £16k at 8 months old. Now I know why contract hire is the only way with BMW's. [/ QUOTE ] You are not comparing like with like. Of course a car worth £24k will only be worth around £16k after 6-12 months, nearly all cars loose 30% in year one, another 10% in year 2 and another 10% in year three. Remember when you buy a £24k car, 17.5% is tax, so the car is only just over £20k and the dealer has around 12% so it costs them around £18k to buy in, so after 1 year offering aorund £16k is expected unless you don't stop and think about it. You a right that contract hire is the way to go if you want brand new and only for 12 months, as the contyract hire company will just hire it again for years 2 and 3. But you can't compare the depreciation of buying a car yourself over 1 year and 3 years. The sensible thing to do is do it over 5 years and take on the final value risk yourself, makes it far cheaper, if you buy it at 3 months old with 30% off list even better, you will be in a £40-45k car for the same price as your £28k audi. So getting a value after 6-12 months is a stupid thing to do, if you have to buy it, and it has to be new, do it over 5 years on balanced and sell it privately after 8 months. And I don't seriously think you beleive that Audis hold their value better then BMWs do you?? Every comparable BMW has a far better residual value at the moment, look at the 535d sport touring against the A6 3.0 tdi s-line quattro, same price at new, after 3 years the finance houses are offering, £12k on the Audi vs £17k on the BMW. Look at a 2005 2.0tdi A4 price vs a 2005 320d price and see which has actually held its value better. I was just offered £2k less for my Jan 206 120d M-Sport than I paid for it by a dealer, when I bought my S-line 2.0tdi for £26k I was getting bids of £14-16k on it after 9 months! And it was meant to be the engine and model to have, there were only 6 on the Audi website used when I was selling it. But that is not the real problem here, the real problem is the way the UK trade works, they offer big discounts to some buyers, fleets, car hire companies etc. and not to others. This brings down the value of our cars like nothing else, the US has so much better residuals because of a few things, decent warranty, a car is still desitrable at 3 years old cause the warranty is still running or you can renew it for another 3 years for peanuts, also the dealers sell cars at £XX.XX over invoice, so you know what they are paying for them and you haggle over how much they make. This is far better than paying £30k for a car only to find out your mate just bought the same model £8k less, it keeps prices more sustained. Audis are a depreciation nightmare as much as any new car, there are very few cars that aren't these days, Porsche used to be the car to buy and not loose silly money on, but even they are loosing loads these days. The S3 will be fine, it will hold onto its value well, I bet at 3 years they will be £18k for a 26k mile car with Nav and bluetooth, just a shame the finance houses didn't have more confidence in them. It is the S4 and S6 depreciation that has ruint it for the rest of the range, with 50%+ losses in 2 years. 2005 S4 for £23k comapared with a same spec M3 getting £10k more and costing the same to start with. Link to comment Share on other sites More sharing options...
Chins Posted March 15, 2007 Report Share Posted March 15, 2007 I dont think Audi is better than BMW, although in the BMW range its hard to find one car that holds its value over the short term. However you can with Audi. Look at the TT, I just sold my TT after 4 months for a £1500 loss. No trade in to distort. Less than 10%. No you lose 17.5% when you drive it off the forecourt crap that dealers spout forth. I also think the A5 will do well. BMW I do think are on the way to being worse than Audi. For our 320d to lose nearly 40% of its value in 6 months. Thats pretty stunning. Look at how much cars such as the 1 series loses. The price I almost bought 118d M Sports at 6 months old was a huge saving off list - 16.5k from a dealer (not for me but one of my guys). The S4 and S6 not the best cars to start with in the presses view which doesnt help their value. Not many people want cars with such big engines and crap fuel consumption. They are also hit that most people wanting a car like that are company directors, bit high on the old company car tax. I do agree that the way that the UK trade is now working is crap and not helping. There are going to be a lot of BMW and Audi owners trying to shift their cars before long being stunned by the losses. Link to comment Share on other sites More sharing options...
Chins Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] [ QUOTE ] The S3's don't seem to be holding their values as well as other cars in their field. The R32 I have just picked up is bog standard and based on a list of just under £25k they are offering me £15.5 based on 20k per annum and 3 years old. Why are the residuals different? I would have thought it would be the other way around. [/ QUOTE ] And that was VW finance, obviously at the end of the term I can hand the car back [/ QUOTE ] Well when I looked at the Edition 30 before I bought the S3, VAG would only give £10k at 3 years and 30k for a £25k car (I got 14,800 from VAG on the S3). Even if finance residuals dont show it, I cant see the R32 being worth the same as an S3 at 3 years. The S3 will be the car the boy racers will want - better mpg, but more important a lot cheaper and easier to get 300bhp out of. Plus the boy racer look at performance figures as an important element - look at the recent Autocar article, the R32 was 2 secs slower to a ton and 2 secs slower round the track than the S3. The future desirability was one of the factors that I looked at before buying the S3, plus the lower emmisions (company car tax) and the fact that you have to add £1600 of leather to the R32 if you ever want to sell it. The price difference then is less than a grand. Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] BMW I do think are on the way to being worse than Audi. For our 320d to lose nearly 40% of its value in 6 months. Thats pretty stunning. Look at how much cars such as the 1 series loses. The price I almost bought 118d M Sports at 6 months old was a huge saving off list - 16.5k from a dealer (not for me but one of my guys). [/ QUOTE ] What 320d was that?? E46? E90? Was it a sport? And the 118d has had serious money thrown at it with upgrade incentives etc. before the facelift. Bringing a 118d m-sport down to £20k with room to haggle on stock cars. The point being I bet you could get £10k for that car after 3 years and 36k miles, so a loss of just over £2k a year, and this is my point, buy it well and you are laughing, but what about the guy who paid £22k for it, who didn't get the deal? Will his car be worth £4k more come trade in?? No of course not, so while people like you and I are paying £180 a month for that car there are people out there paying over £400 a month to be in the same car, and becuase of this the whole new car industry is going down the pan, he won't buy another new car again. But it was the same with the A3 before the single frame grille came out, my neighbour nearly bough a 2.0tdi s-line from Robinsons Norwich with a few toys for £24k new, in teh end we found him one through a broker in stock with better spec and he paid just under £17k for it, so do you class that as a car that has held it value or one that has lost sh|t loads?? I don't know? Link to comment Share on other sites More sharing options...
Chins Posted March 15, 2007 Report Share Posted March 15, 2007 320d is the ES Touring version. E90 - its on an 06 plate Link to comment Share on other sites More sharing options...
Adam Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] No you lose 17.5% when you drive it off the forecourt crap that dealers spout forth. [/ QUOTE ] does anyone actually believe this nonsensical concept? a £50k retail car is worth £50k and depreciates down from there not £42.5k. Yes a dealer pays 17.5% of the 50k to the taxman but they also reclaim VAT paid on their purchase price (say 40k) so 17.5% on their 10k mark up or £1.75k. When they buy it back after a year (say £40k and they sell on for £45k) they pay VAT again but only on the profit of £5k. If this is a private deal VAT is irrelevant. Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 I know that is the case Adam, but when you have a figure in front of you to buy a new car are you going to offer more to buy it used?? Speaking to mate who work for these dealers this is the problem they face. Chins, you say it was an ES, well that is £24k new, so I would expect to get that for around £21k after discount, and yeah be worth around £16.5k after 6-12 months, around £14k after 2 years and around £11k after 3 years. They would then retail it for around £2.5k more than that, so £18.5k, after a year, sounds about right doesn't it? Link to comment Share on other sites More sharing options...
Chins Posted March 15, 2007 Report Share Posted March 15, 2007 The touring is £25.5 basic, plus metalic taking it to as near as damn is £26k. I think we paid just slightly over £23k Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 Look at it another way, what what you pay for a second hand 320d ES touring? I bet you would want it for £18/19k? To be fair the base model BMW estate is never going to be the best one to move on after 6 months. I do think that you have got your fingers burnt a bit buyingg the wrong car in the first place, but you can't say because of that all BMWs loose silly money. I bought my 535d for £35k and sold it a year later and 20k miles added for £32.5k, I bought my 320d sport touring auto withe leather and nav for £19950 at a year old with 8k miles on it and sold it 18 months later with 46k miles on it for just under £18k, If I had bought it new it would have been £32k, the first guy paid £29k for it and lost what? £10k in a year. So you can always take any car and say it holds money or it looses money, depends how you look at it. But the point was the S3 will do alright, and it is a shame the finance houses don't have a bit more confidence in it, but the dealers don't these days, mainly cause they know that they will sat giving away free things like Nav, leather, upgraded wheels etc. within a few months of the car being out, which can only hurt used car prices. Link to comment Share on other sites More sharing options...
Adam Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] I know that is the case Adam, but when you have a figure in front of you to buy a new car are you going to offer more to buy it used?? Speaking to mate who work for these dealers this is the problem they face. [/ QUOTE ] Sorry you've lost me there - of course you are not going to buy a used car for more than a new one. Where did I say that? My example included a new car at £50k then sold on second-hand at £45k. This VAT line is a complete red herring. Yes when you buy a new car you see 17.5% of the value as VAT. Do dealers really try to spin this that somehow that is value lost when they offer a PX value because that is stupid - a maximum of £1.75k, being the VAT on their mark up only, is lost (using my example figures above) from the dealer's profit margin but again so what. It is not necessarily lost from the value of the car, it is simply part of the dealer's overheads just like staff costs. Do you say a new £50k car immediately depreciates by £500 because that is the salary/bonus the dealer had to pay the salesman for selling that car? Only possible way I can see tax has any implication on the value of a dealer's car could be if its ex-demo - here the dealer buys the car themselves and own it as an asset so reclaims the VAT on purchase (from BMW UK or Audi UK etc) and there is no immediate onward sale. Then when they sell it is likely (I am an accountant but have not worked in the car industry so applying general principles, happy to be corrected) that it is treated as a disposal of company assets so that any proft on diposal is not subject to VAT (but the profit would be still be subject to corporation tax). Maybe this is why it is possible to get good deals on ex-demo cars! Link to comment Share on other sites More sharing options...
Adam Posted March 15, 2007 Report Share Posted March 15, 2007 Just reading Chins sentence again and maybe this is why people get confused - cars lose 10-20% as soon as they are driven off the forecourt is usually a true statement. This is because the new car has immediately became "used", the next owner will be the 2nd owner, it is someone else's spec etc. It just has bog all to do with VAT. Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] [ Do you say a new £50k car immediately depreciates by £500 because that is the salary/bonus the dealer had to pay the salesman for selling that car? [/ QUOTE ] Yeah I do. Of course it does, ot has come off your profit, therefore if I were to buy that car in again I would look at my books to see what I actually got for it and that would be a one of the figures that comes off the top line. I understand how it works with the vat on used cars, and I also understand that a dealer can buy a car of a customer for more money than they can buy that same car new and make more money on it, however, if you are a dealer and BMW havea new 320d ES in stock that you can buy for around £18k are you seriously going to pay more than say £16.5k for an 8 month old one owner car?? If you look at most Audis, BMWs, Mercs and even Porsches these days they all seem to loose around 30% in year one and then 10% in years 2 and 3, and I know from speaking to the guys at Lind they don't really want 6 month to 1 year old cars, as they can't give the customer what they want, problem is the used car market gets filled with ex company/lease/hire cars that have been bought, vat claimed back at 50% and then sold on for far less than private buyers can put them back into the market for, this brings the used values down across the board. How am I able to buy my 335i with over 20% off list after 3 months and 4k miles? Has it got anything to do with the vat already being claimed back? I don't know? But I bet it helps keep the price down. Link to comment Share on other sites More sharing options...
gizze Posted March 15, 2007 Report Share Posted March 15, 2007 [ QUOTE ] It just has bog all to do with VAT. [/ QUOTE ] I guess we will have to agree to disagree? Link to comment Share on other sites More sharing options...
D1MAC Posted March 16, 2007 Report Share Posted March 16, 2007 [ QUOTE ] How am I able to buy my 335i with over 20% off list after 3 months and 4k miles? Has it got anything to do with the vat already being claimed back? I don't know? But I bet it helps keep the price down. [/ QUOTE ] Presumably it gets registered as a demo and avoids the VAT (apart from the element on the profit on sale). A bit of a discount as well and hey presto! Link to comment Share on other sites More sharing options...
Adam Posted March 16, 2007 Report Share Posted March 16, 2007 think we are talking at cross purposes my friend [ QUOTE ] Yeah I do. Of course it does, ot has come off your profit, therefore if I were to buy that car in again I would look at my books to see what I actually got for it and that would be a one of the figures that comes off the top line. [/ QUOTE ] eh? If it was my business I would treat the past as the past, the previous P&L is totally irrelevant to current or future P&L. When I bought in a SH car I would not care whether I had sold it originally or not. My bid offer would be simply equal: likely sales price less cost of sales (refurb/advertising/ salesman incentive I would pay on THIS sale/VAT on margin) less the profit I deem acceptable to cover overheads and pay me. [ QUOTE ] if you are a dealer and BMW havea new 320d ES in stock that you can buy for around £18k are you seriously going to pay more than say £16.5k for an 8 month old one owner car?? [/ QUOTE ] er no, why do you imply I said that? £16.5k sounds way too high. If retail on an 8 month old BMW was £16.5k (seems high for an £18k new car but anyway) that would be the first figure in my calcualtion above. [ QUOTE ] If you look at most Audis, BMWs, Mercs and even Porsches these days they all seem to loose around 30% in year one and then 10% in years 2 and 3.....How am I able to buy my 335i with over 20% off list after 3 months and 4k miles? Has it got anything to do with the vat already being claimed back? I don't know? [/ QUOTE ] Absolutely not, no! (Unless it was an ex-demo car in which case quite possibly Yes! which I explained already in post above). Depreciation happens and in the way you describe, it has to do with all the things I mentioned above but has nothing to do with VAT. Edited to add - reality is most ex-demo cars are sold for almost the same price as an identical, same age SH car bought from a customer (maybe a bit less as the assumption is a demo has been thrashed whereas an owned car may not have been) - the dealer just makes more money on an ex-demo car. Why do you think the buy them in a constant stream and replace them so quickly? Link to comment Share on other sites More sharing options...
gizze Posted March 16, 2007 Report Share Posted March 16, 2007 Sorry Adam when I said they could buy a new car for £18k, I meant the dealer, less there profit and less vat, the retail is around £25k and £23k after discount. That was a it misleading the way I wrote that. Link to comment Share on other sites More sharing options...
Adam Posted March 16, 2007 Report Share Posted March 16, 2007 gotcha - no worries Link to comment Share on other sites More sharing options...
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