I’m a bit credit averse generally, but the EV’s coming of age has wiped away any lingering doubts about using PCP in my mind.
The rate of technical progress is mind-boggling. With charging speeds doubling, game-changing solid state batteries poised to come on the market and no doubt more around the corner we may not know about yet, today’s EV will be well behind the curve in three years, so who can really predict the rate of depreciation?
For the uninitiated, personal contract purchase (PCP) is one of the most popular ways of financing a car, usually involving a deposit, maybe with a ‘deposit contribution’ from a manufacturer as a sweetener, a fixed repayment term and agreed mileage.
At the end of the term there’s a guaranteed future value which means you can either hand it back, pay a final lump sum to own it outright, or re-finance the balance.
The guaranteed future value avoids the danger with outright ownership of taking an unexpected hit when trading in or selling privately. I usually find it tough to get the price I’d like when I sell, although it could just be that I’m just rubbish at selling cars.
PCP has been controversial in the past and some people view it as a poisoned chalice, “if it looks too good to be true, it probably is,” kind of thing.
The catch is, that starting again with another new car when your time’s up means paying another deposit, and that can be too convenient to overlook at the start. I finally decided the best approach is to put the money away for that deposit and treat the true cost of buying as the sum of the monthly repayments and the savings for the next deposit.
Having come to the conclusion I didn’t really need the X5 40d M-Sport I was driving anymore (and was fed up £100 a pop fill-ups) I worked out that over three years, including home charging at 16.5p per kWh, I’d save a staggering £5,000 on insurance, road tax and fuel by replacing it with a medium size EV.
That would take the sting out of repayments so Mrs C. and I took the plunge and swapped both our daily drivers for a Kia e-Niro and Renault Zoe.
I don’t want to own an EV outright though, and although I never thought I’d say this, the finance companies are more than welcome to the interest we pay them.
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As an electric vehicle owner with pcp I can say 100% without contradiction that it's the biggest mistake I've ever made.
I can go nowhere, do nothing and plan nothing anymore. The infrastructure is so poor in Scotland the car sits at home or is used for round town duties.
We ended up cancelling our holiday because going to the airport and back last time was a fiasco that took 3 days and an overnight hotel stay. One trip away we desperately end up sitting in Tesco charging for 4 hours to get us home. Take it from me, EVs are a big con with very few upsides.
Only tree huggers would think an electric vehicle is a suitable replace for the internal combustion engine.
In 8 years time there will be a heap of unsold second hand electric vehicles
Only tree huggers would think an electric vehicle is a suitable replace for the internal combustion engine.
In 8 years time there will be a heapof unsold second hand electric vehicles