Should I upgrade to the S ?

[Wivenhoe]

In the UK if a car is ‘leased’ on a PCP then when you have paid more than 50% you can return the car at no cost. It depends how much deposit you paid when the 50% is reached. Friends recently returned a car on this basis 20 months into a 3 year PCP at no cost. Perhaps the OP is on a PCP ‘hire’ rather than a locked in lease.

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[dwauch]

In the UK if a car is ‘leased’ on a PCP then when you have paid more than 50% you can return the car at no cost. It depends how much deposit you paid when the 50% is reached. Friends recently returned a car on this basis 20 months into a 3 year PCP at no cost. Perhaps the OP is on a PCP ‘hire’ rather than a locked in lease.

Wow - that is cool. Wish we had that here. US leases are pretty standardized and locked in. If the car is worth more than the payoff, it can make sense to get out early, but that is rarely the case. Generally it costs money to get out of a lease early. Sometimes manufacturers have a Pull Ahead program in the final months of a lease, which forgive the final monthly obligations if the Lessee gets another vehicle from the same OEM.

 

[Wivenhoe]

dwauch for your info getting a car on a PCP is the most popular and default way to finance a car in the UK. It was available from about 2007 and now accounts for about 80% of car finance.

The major manufacturers have taken a massive hit as a result of poor residuals, particularly EV’s. As the PCP’s were based on optimistic forecasts of residual values, every car was being returned rather than being bought at the end for the optimistic value. That resulted in mass dumping of cars into the used market which dragged the market price down further. As the interest rates have shot up and forecast residuals have dropped, the cost of PCP’s has increased so sales have dropped. I think it’s the company car market keeping more expensive sales of Merc’s & BMW going here.

I wish I had got my 2023 Lexus RZ EV on a PCP - I stupidly bought it so took all the risk of the residual. At the time Lexus were basing the PCP on a residual value after 3 years of 55%. I hated the car so sold it after 20 months and got only 52% - if I had got the car on a PCP I could have walked away £ ‘000 ‘s better off. Porsche are suffering greatly with the same issue on the Taycans they sold on PCP’s. I dread to think how much that has cost them.

 

[dwauch]

dwauch for your info getting a car on a PCP is the most popular and default way to finance a car in the UK. It was available from about 2007 and now accounts for about 80% of car finance.

The major manufacturers have taken a massive hit as a result of poor residuals, particularly EV’s. As the PCP’s were based on optimistic forecasts of residual values, every car was being returned rather than being bought at the end for the optimistic value. That resulted in mass dumping of cars into the used market which dragged the market price down further. As the interest rates have shot up and forecast residuals have dropped, the cost of PCP’s has increased so sales have dropped. I think it’s the company car market keeping more expensive sales of Merc’s & BMW going here.

I wish I had got my 2023 Lexus RZ EV on a PCP - I stupidly bought it so took all the risk of the residual. At the time Lexus were basing the PCP on a residual value after 3 years of 55%. I hated the car so sold it after 20 months and got only 52% - if I had got the car on a PCP I could have walked away £ ‘000 ‘s better off. Porsche are suffering greatly with the same issue on the Taycans they sold on PCP’s. I dread to think how much that has cost them.

Ugh - sorry to hear about the hit. Lexus is usually a great long term investment. You just got caught in a period of great price adjustment. From a world-view perspective, it's great that there are a lot of affordable EVs for people to buy. Including apparently a slightly used Lexus RZ! Hopefully that will help get some people into Electrics.

 

[Wivenhoe]

dwauch - the hit wasn’t as bad as it seemed as the px market was exceptional so price they gave me for my Range Rover was very generous. If I’d kept the RR it probably would have dived just as much.

To show bad the market was, the Lexus dealer would only buy the RZ (less than 10k miles) against a new RZ And even then the price was less than I got. The independent I sold it to only managed to make less than £ 1k - I know as the owner contacted me about something.

As you say, bad timing for the market.

 

[TS23]

In the UK if a car is ‘leased’ on a PCP then when you have paid more than 50% you can return the car at no cost. It depends how much deposit you paid when the 50% is reached. Friends recently returned a car on this basis 20 months into a 3 year PCP at no cost. Perhaps the OP is on a PCP ‘hire’ rather than a locked in lease.

To add and clarify that’s 50% of the total payable, not 50% of the payments due, to voluntary terminate a vehicle.

So if a Macan is £90k with let’s assume £10k deposit, £18k interest and £55k GFV (48 months), the VT would value would be £49k, which wouldn’t arrive until approx month 26.

Some wrongly assume once you have paid 24 payments (in said 48 month agreement), you can hand the vehicle back.

 

[Wivenhoe]

I am sure a lot of buyers do mistakenly think it’s at the halfway stage. Thats why I said it depends how much deposit. A friend who was comparing the monthly cost of PCP’s completely missed the cost of the various deposits. When I told him he should divide the deposit over the payment period he quickly realised the apparent cheapest was actually the most expensive !

My point was that the OP could have got the car on a PCP which does mean you can return the car at no cost quicker than on a lease.

I think the German manufacturers did extremely well out of the PCP basis of getting a car as people who could only previously dream of getting a BMW or Merc could actually get one without paying a very high entry cost.

 

[BruceS2]

Thanks everyone, all good points. I did see the GTS after I made this post and mostly I do like what I saw so that might be the best choice. I'll likely wait longer until the lease gets closer but I did talk to my dealer and they said they would know their allocations in about a month and would get back to me with what options make sense. And who knows what will happen on the tariff front...

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