| Product: |
General Comments / Tips Concerning Your Car |
| Date: |
20/06/01 (786 review reads) |
| Rating: |
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Advantages: Knowledge is power
Disadvantages: There are many pitfalls for the unwary
Buying a car is a risky business. If you buy a new one, then there is a good chance that its value will plummet in its early years. If you buy a used one, then there is a risk that it was sold by someone who knew that it had expensive repairs looming.
To limit the amount of time and money that you spend on a car, you should start by thinking carefully about what features you need from it, and not just now, but in the next few years as well. It might be that you need a lot of space for a lot of passengers or luggage, or that you would be better off with a car with low running costs. If the car you buy has features that you don't need, then you might be spending too much on it. If it is missing key features, then you will have to replace it, and are likely to lose time and money selling it and buying another car.
If your aim is to spend as little time on buying and maintaining a car as possible, with no worry about the running costs, then a private leased car or a PCP deal are the least hassle, although you pay a hefty premium for this. You get to use the car for a contracted period and then just hand it back at the end with a leased car. With a PCP deal, you are guaranteed a minimum value if you decide not to keep the car after the end of the deal. Leased cars will usually be new or nearly new and maintenance will be done through franchised dealers. These may be expensive, but you'll usually get a courtesy car to use when they are working on it.
Buying a new car every few years from a dealer and part-exchanging it each time is a little more hassle, but nearly as expensive as leasing. You have the risk that the car that you choose ends up being unpopular which might hurt the part exchange value.
This isn't so bad if you extend the time that you own each car. The difference in the money you have lost in depreciation between popular and unpopular cars is a lot more marked for 2 year old cars than 10 year old ones. If yo
u own a car for a long time, then you can make sure that it is properly maintained, and reap the benefits. If you chop and change every few years, there is always the temptation to go for a quick fix rather than a long term solution. Sometimes these quick fixes don't last and you have to deal with the problem again. If it turns out that a problem occurs again, then you are more likely to be able to fix it quickly and easily. When you drive a car for a long time, then you can to learn to use the controls for things like the radio, hazard lights, wipers and heater without having to think about it or fumble for the switches.
There are people who manage to buy and sell cars quickly whilst making money on their deals. This takes skill or luck and a fair amount of time. The problem is that you have to make sure that you don't make a series of small gains that then get wiped out with a single catastrophe. When you change your car, you may find that your old insurance company doesn't offer a competitive rate for your new car. You don't get much money back if you cancel an annual insurance policy to switch to another company. This can mean its cheaper to switch to a different insurance company and waste the remainder of the old insurance cover. If you buy and sell cars frequently, then you can to drive a range of cars and that can be fun, just make sure its not expensive fun.
Having covered the range of deals on offer, the thing to decide is on where to buy your car. Over the last few years, the list prices of new cars have been artificially high. Big fleet customers have been paying more sensible prices, as have customers in some European countries. UK list prices have dropped in the past year, but if you are thinking of buying a new or nearly new car, its still worth considering whether you want to buy a car that has been imported from elsewhere in Europe. For some cars, importing a car yourself is no longer worthwhile. For others, there
are still handsome profits to be made.
When you import a right hand drive car from Europe, some manufacturers like Ford will sell you exactly the same models that they would sell in the UK. Others will only supply the specifications that are sold in the country you are buying from. Sometimes these will have the same model name, but a different spec. Othertimes, they will have a completely different model name. These can cause problems when it comes to getting insurance as some of the computer systems used by the insurers will only allow models on sale directly in the UK. For instance, if you import a "Vauxhall" from most of Europe, it will have Opel badges. If you import a Skoda Octavia from Ireland, then the GLX specification doesn't have ABS, whilst the UK GLX does. The best source of information on how to import a car that I've found is http://www.truro.swinternet.co.uk/
When you import a new car, the vehicle registration document will usually say "Declared New at first registration" - just like a UK-supplied car. However, in the service book, the supplying dealer will have stamped to show that it had done the pre-delivery inspection. The car manufacturers will know that your car has been imported from the Vehicle Identification Number. When you buy an imported new car, it will have a 1 year manufacturer's warranty which will be honoured with few questions by UK dealers. What you won't get is a longer warranty than that unless you pay extra for it. UK cars which have a "3 year warranty" really have a 1 year manufacturer's warranty and a warranty from the dealer for the 2nd and 3rd years. For a Ford Focus, you can buy a warranty for the 2nd and 3rd years for about £400 from Ford, or for under £300 from other places like http://www.warrantywise.co.uk and http://www.motorwarrantydirect.co.uk.
An easy way of buying an imported car is from a car supermarket like Motorpoint in Derby (http:
//www.motorpoint.co.uk) or Trade Sales in Slough (http://www.trade-sales.co.uk). Not all of their cars are imported, but quite a few are. If you buy something from there, then make sure you check exactly what a given specification car should have. On the plus side, they keep stocks of cars that you can buy there and then. Be careful that some of these places have been known to advertise wonderful prices which turn out to have sold out when you try to buy them. You may then be offered a similar car at a higher price.
When I bought my car (from http://www.ford-delta.com), the UK list price was £14500. A local dealer was charging £11000 for a used car without £1000 of extras. I ended up paying less than £10000 including all of my costs for importing (I got the timing right for exchanging my money, which helped save a few hundred pounds). The UK list price is now £13500 and the Glass's guide trade in price for my 8 month old 12,000 mile car is about £8000. To buy one from somewhere with reasonable consumer protection and with a years warranty would cost £1500 or so more than that. Motorpoint are advertising a similar but different specification for £9999 which might well be worth checking out.
The problem with the silly pricing of new cars in the UK has been that the prices of second hand cars have also been distorted. When I was shopping for a new car in Easter 2000, it was a choice between buying a 1-2 year old used car or a brand new imported one. Even the earliest of the Ford Focuses on the market were being sold for £8000 or so.
Traditionally the advice has been to avoid buying new cars, but to buy nearly new ones to avoid the initial depreciation. I would say that you're better off avoiding overpriced cars whether they are old or new. A new car is worth more than a used one - for one thing you get a much higher level of consumer protection. A "new" car is supposed to be in near perfect condition, and you can get minor
problems fixed for nothing. A garage that has supplied a used car might fix problems to maintain goodwill, but they don't have the same legal requirements to do so. For instance if you buy a 3 year old car, you will have some comeback if the gearbox or engine breaks soon after you buy it, but you won't if its the radio or heater.
There are a lot of fine cars around which are older than this. The problem is that there are some awful ones as well. A car that is 3-6 years old should have a reasonably long life left in it. However, some cars of that age will not be economic to run once they are 10-12 years old. Cars have got a lot more complicated in recent years, with air bags, ABS, catalytic converters and complex engine management systems. These are fine when they are new. However, catalytic converters are permanently damaged if unburnt fuel passes through to them when they are hot. This is the sort of thing that is likely to happen when fuel injectors get coated with muck after years of use, and this could leave you needing to spend several hundred pounds to get your car to pass its next emissions test at the MOT. Most of the time, engine management systems work perfectly and are great. The problem is that if you get poor connections or failing sensors, it can be tough to track down exactly what is causing the problem.
There are 10 year old cars which are a lot simpler and which may well be durable and cheap enough to last for many years yet. The problems are that older cars will have lower specifications (air conditioning and pollen filters are nice) and safety levels (as are ABS, air bags, good NCAP ratings for crash protection), and you need to find one which isn't being sold because of impending problems. Personally I've bought most of my cars from family members, where there was a genuine reason for the sale, and this has worked well for me.
I have visited car auctions out of idle curiousity. There are some real barga
ins there with interesting cars, but again, there are some absolute horrors. If you are interested in keeping an eye on the car auction scene, then its well worth checking out the review of auction prices at FleetNewsNet. Its updated every Friday with an interesting summary on the state of the market. See http://www.automotive.co.uk/fleetnews/start.htm for more.
Its also worth keeping an eye on second hand cars available through http://www.autotrader.co.uk, particularly if you are looking for a specific model and specification. You can search for prices nationally, which lets you get a feel for the prices in the market, even if you would only want to actually view cars that are much closer to home.
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