As dealerships and supersites reopen on June 1, I caution that buyers should not automatically expect to make a killing when buying a new car despite the industry being desperate to resume business and sell cars.
While logic might suggest that there will be bargains galore, in reality you are unlikely to get a fantastic deal on a new factory order that still has to be built. You may get a discount, but it will be a discount on a higher price than the car was listed at six months ago.
We have listed below some of the discounts we found on existing stocks this week.
Potentially, this summer, there will be two types of bargains. The first is new, unregistered cars that have been sitting in compounds for as long as four months.
Can I get a good deal on an unregistered car?
What kind of deal you get on these will depend on how well they sell initially, once showrooms have reopened. It will probably be smaller discounts to start with, then bigger discounts as stocks get sold but some makes and models start to stick and the choices of colours and specification dwindle into the less desirable.
Before lockdown, 80% of new sales to private owners were Personal Contract Purchases (PCPs) in which the buyer borrows the full cost of the car minus his deposit, makes a monthly payment then, after a contract term of two, three or four years, can buy the car at a pre-guaranteed price or use any equity above this to pay the deposit for another PCP on a brand new vehicle. Significant discounts are often offered to encourage buyers into PCPs.
Which cars are available at the biggest discount?
The bigger bargains – with savings between 10% up to 30% – will be among pre-registered cars between three and six months old; some on a 69 registration (applicable from September 1, 2019); some on a 20 registration (from March 1, 2020) that were registered to qualify for manufacturer end-of-month volume discounts but were never actually sold. These need to be offloaded and turned into money.
The problem facing buyers is in detecting what is a real bargain and what is not.
The true age of the car and the date of registration are crucial. New and unregistered is the most valuable; pre-registered on a 69 registration is the least valuable. The difference can be 30% to 40% in the transaction price.
Then there is the specification. The ‘list price’ of the car on offer might include a lot of things you don’t want. It’s almost impossible to compare like with like, but the discount will be based on the list price with all the extras the car has, not the basic list price.
On top of that is the finance deal. A PCP may or may not involve a customer deposit. Term periods vary from 23 months to 48 months. Pre-set ‘Guaranteed Future Values’ vary enormously and whether they are advantageous to you or not depends on the state of the market at the end of the term.
So it’s a minefield. Nothing is cut and dried. Never compare ‘discounts’ in percentage terms; only compare the actual prices you are being asked to pay. And my advice is not to buy a pre-registered car unless it is being offered at a rock-bottom price.
Should I buy now or wait?
On Monday June 1, the choice of ‘new’ cars in compounds and dealerships in the UK will be at their greatest. By the start of July, the cream of these will have been sold and the residue of less desirable cars will be offered at lower prices. By August 1 the choice will be further reduced and the prices even lower.
But if you want a freshly-built, 70-reg car on September 1, don’t expect it to come cheap. Discounts will still be available because everyone wants to think they are getting a deal. But the true transaction prices will be at a significantly higher level than they are now.
We found: current new and pre-registered deals via manufacturers and large dealer groups
New car discounts
Renault Kadjar 1.3TCE Iconic: £15,286 (save £7,812 on new car list price, PCP only)
Nissan Juke 1.0 DIG-T N-Connecta: £17,283 (save £3,757 on new car list price)
Kia Niro 1.6 GDI self-charging hybrid, pre-registered: £22,121 (save £2,898 on new car list price)
Vauxhall Grandland X 1.2 Turno Elite Nav Premium 8-speed auto: £24,031 (save £7,884 on new car list price)
Jaguar XF 2.0D Prestige: £28,491 (save £6,932 on new car list price).
New 20 reg Fiat 500 1.2 Lounge: £10,498, save £4,222 on current list price
Brand new Kia Soul EV 64kWh: £34,295, save £3,000 on current list price
Brand new Ford Focus 2.3 EcoBoost ST: from £29,441, save £2,569 on current list price
New 20 reg Seat Leon 1.5TSI EVO FR: from £19,995, save £2,085 on current list price
New 20 reg Renault Clio 1.0 SCe 75 Play: from £13,698, save £997 on current list price.
Dacia Sandero 1.0SCe Access: £6,870 (£7,841 on 48 month PCP)
Dacia Duster 1.0SCe Access: £10,995 (£12,903.14 on 47 month PCP)
Citroen C1 1.0VTI 72 Feel: £11,860 (13,284 on 44 month PCP)
Renault Clio 1.0SCe 75 Play: £14,895 (£13,565 on 36 month PCP)
2019 Vauxhall Corsa 1.2 SE: £14,797 (£14,797 on 48 month PCP).
New Ford Focus 1.5 EcoBlue ST-Line X: £22,774 (save £2,551)
Fiat 500 1.2 Lounge: £9,990 (save £3,615 on current list)
Seat Ibiza SE Technology: £10,900 (save £4,600)
Nissan X-Trail 1.7 dCi N-Connecta: from £20,750 (save £8,845 on list price)
Drivethedeal (all new and unregistered)
Audi A4 Avant 35 TFSI Black Edition S-Tronic: £31,985 (save £8,295 on list price for spec)
Audi Q3 40TFSI Quattro Vorsprung S-Tronic: £37,819 (save £8,921 on list price for spec)
Mercedes-Benz A200 Sport Excecutive Auto: £24,450 (save £6,300 on list price for spec)
Mercedes-Benz A35 AMG 4Matic Premium: £35,350 (save £6,105 on list price for spec)
Mercedes-Benz GLB 220D 4Matic AMG Line 8G-Tronic 7-seater: £40,795 (save £6,080 on list price for spec)
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