Buying a new car for cash

R

Roro999

Registered User
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Are the old days gone when you got a bit of discount for buying in cash ? Not that long ago dealers would knock a couple of grand off if buying for cash. Am I wasting my time when I start looking in the New Year trying that avenue. Would be looking at a car of approx €35k.
 
Brother in law works in the industry and mentioned that they have targets to hit each month to sign people up to PCP/finance. They get commission on it.
 
2nd hand?
A lot of garages run 2 prices, with & without trade in. People get offended with a low value on their trade in, so garages just add the uplift to the price of the car.
But you're better to do your research and see what other garages have listed the same model for. Carzone, Donedeal etc will inform you before you try negotiate. There's short supply of a lot of models, so negotiation ability might be limited.
As above, garages get commission on some types of finance, so cash might be a disadvantage over financing through garage.
 
Was in with a couple of dealers in December. I have a 202 Kodiaq to trade. A friend is half interested in buying. I got a quote trading the car in,
Asked the dealer what if I was not trading in the car. Same quote was given no discount for all cash. That was in Skoda dealerships.
 
A good few years ago now my mechanic advised me when buying a car to say I was going with the garage's finance package until deal was done, he said they make more money on the finance side that they do on the car sale! True or not I don't know.
 
Scoobydoobydoo said:
Brother in law works in the industry and mentioned that they have targets to hit each month to sign people up to PCP/finance. They get commission on it.
Click to expand...
This. It is especially true in the US and apparently starting to be so here where you'd negotiate saying you will take the PCP, get the final price, and only then say you will pay cash instead.
 
ryaner said:
This. It is especially true in the US and apparently starting to be so here where you'd negotiate saying you will take the PCP, get the final price, and only then say you will pay cash instead.
Click to expand...
Do they still have to honour the quote if you say you don't want the PCP at the last minute?
 
It's a shame to think that you'd have to mislead the salesperson, by pretending you'll avail of finance, to get the best deal...

Personally, I'd be very slow to do business with anyone that wasn't willing to give a bit of an additional discount, when no trade in, involved. There's always another dealer, and always anther car....

With changes greater concerns about a recession, car dealers may soon be struggling to sell bright shinny new cars, so don't be afraid to remind them of that!
 
My experience over the last 2 months looking for a 2-3yo used car across the country suggests very little (if any) discount for a cash buy (no trade-in or finance). 1-2% max, and that's by visiting the dealership and 'negotiating'.

Last car I purchased was 7 years ago, and got approx. 9% discount back then. Different times I know!

I suspect the climate will be different in 12-18 months when many PCP/finance customers go to renew, and are met with 5-10% rates as opposed to 0%. That coupled with the price of new cars increasing by 15-20% since 2019/20 is bound to have a ripple effect on the whole car industry, but the cash buyer is unlikely to benefit from this in the short term.

However, the car finance 'bubble' might extend another cycle of 3-4 years, but if ECB rates stay 2.5% or higher, and depreciation of cars normalise, people renewing PCP/finance in 2023-25 will be stung when they go to renew in 2026.

For example: Car is 3yo. My estimate is a customer will be able to continue paying the same monthly amount for a new equivalent car in 2023 even though (i) PCP rates go from 0 to 6.9%, and (ii) new price of their car has increased by 18% since Jan 2020. This is because they can trade in their current car to the dealer (or sell privately) at an elevated price as depreciation has been low over the last 3 years. However, in Jan 2026 when the cycle starts again, if (i) PCP rates stay at the 6.9%, (ii) new car price stays the same, and (iii) depreciation normalises, the buyer will be left paying substantially more on a monthly basis.

I can provide excel of calculation detail from example above but not sure how to attach.
 
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