Contract Hire / PCP / Other - Mattster
Considering a new car and exploring the possibility of not purchasing outright. Lexus IS for £279.99 pcm looks OK (= about £3,400 per year). Presume at that price you get nothing in the way of insurance, servicing or anything other than depreciation and financing avoidance.

Is there any circumstance in which any of these schemes are actually better than buying? Since the companies offering the schemes are commercial enterprises and need to make a profit by hiring to you, surely not?
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Mattster
Boycott shoddy build and reliability.
Contract Hire / PCP / Other - Falkirk Bairn
If this is the deal on the HJ site you have forgotten £1700 deposit + VAT on all of the above figures (unlesss you are VAT REG whereby you can claim some/all of it back)

£280 + VAT + 6 mths deposit+VAT = £5922 in Year one if you are not VAT Reg.

i.e. About £2500 more than indicated in your post. £1600 more if you are VAT Reg

Basic leasing covers use of car for say 10,000 miles- you are responsible for Ins/Sevicing/Tyres etc. RFL may or may not be included.
Contract Hire / PCP / Other - Bromptonaut
You need to carefully compare the total costs. If only intend to keep the car for three years and return it unmarked within the contract mileage you might be better off. Return it scratched, or change your circs and exceed the contract miles and you get hammered (got the tee shirt!)

If you intend to keep the car for longer than the contract period there are probably better deals based on cheapest finance and screwing down the dealers best deal for cash.

Contract Hire / PCP / Other - mlj
I did do PCP once, thinking I had spotted the flaw in the system. Agreed a contract of 10K per year which I exceeded by about 25K over three years. At 6p per mile, that was some excess bill! But I always planned to buy the car and when I did so there was no mention of mileage by either the Dealer or finance company. So I did get 'away with it'. I suppose as long as you are going to buy the car, agreeing a low annual mileage is a way of reducing the monthly outgoings. Still an expensive way of buying a car.
Contract Hire / PCP / Other - Bill Payer
I did do PCP once, thinking I had spotted the flaw in the system.


What you did isn't a flaw, it's a pretty standard thing to do & it worked out for you. However, people could find their circumstances had changed and would struggle with a big excess mileage bill if the car had to be returned.

There can be some good PCP/Lease deals around - Mercedes, for example, seems to prefer to subsidise these deals rather than drop the prices of its cars. I also saw an ad for the Peugeot 107 at £99/mth with a ridiculous final value figure of about £4500 - that's probably a pretty good deal. It's how many cars are sold in the US - heavily supported final values so the lease costs are very low.

It's a good idea to seriously consider GAP cover if you go for a PCP - if the car is written off then the settlement figure could well be a lot less then the outstanding finance. But buy it from an online supplier, not from the dealer.
 

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