Saturday 29 April 2017

Trading down dilemma? BMW or new Skoda? Hold or change my Accord?

Independent advice desk

A reader is being encouraged by his wife to change to a seven-seater
A reader is being encouraged by his wife to change to a seven-seater

Aidan Timmons and Motoring Editor Eddie Cunningham team up to help readers make the right choice with their next car

I have a 2016 Skoda Superb, 2.0 TDi Ambition spec with DSG (19,00km). I own it outright.

I want to trade down to a car around 4/5years old and have a genuine reason for wanting to sell my own. It's a great car and has been problem-free. The problem is that no dealer is willing to do a deal at sensible money. I paid €37k for the car and I reckon its retail value is around €32k. I'd have thought it'd be worth around €27k if I were to sell it to a dealer I was going to buy an older car from. The people who buy cars for cash are offering €21k and any dealer I've spoken to is offering €23k. The dealer I bought it from says he might be able to do a deal but three months on is dragging his heels. I suspect he's not going to help. Any advice?

Aidan: Whatever you do, don't let the car go at those prices.The problem is, there is already a decent supply of fresh plate ex-demo and ex-hire models of almost every variety on the market. Your car represents quite a big financial undertaking for a dealer to stock when they are already presented with cars being traded in against new 171 plate vehicles. Their cash flow is tied up in the normal mechanisms of running a business at this time of year. You are the victim of nothing other than bad timing.

The appetite just isn't there for additional 2016 plate metal. So, how about you approach a dealer from another angle. We talk a lot about the Cost-to-Change on these pages. That is the amount of money you need to spend to buy your next car. How about the reverse of this? Position the deal whereby you use the Superb as a trade-in against an older car and see if a dealer will give you a smaller amount of money as the difference between the two prices. This way, the dealer gets rid of one of their used cars, takes in another, albeit more expensive used car; but only has to write a cheque for a much smaller amount than if they bought the car outright from you. You drive out of the gates with your car and a cheque. We would be interested in hearing how you get on with this tactic. Keep us posted.

Eddie: I feel for you on this, but you can't sell at those prices. Aidan is spot-on. Do a 'reverse' trade-in. You should do much better than trying to sell it on its own. As part of a package deal you have more leverage. How you do it is vital. While not showing how anxious you are to shift it, I would broach the deal with a dealer by saying you are downsizing and testing the waters. I'm betting you'll fare much better than you have to date.

I currently drive a BMW 520d SE 161 reg) on a PCP at 3.9pc APR.

This was a first foray into PCP, my second 520d, 4th BMW. We are expecting our third child and I am being "encouraged" by my wife to change to a 7-seater. Mileage is 15,000/year. I have narrowed it down to two options:

A. BMW 216d Gran Tourer Luxury spec - list price €44,500 (the 520d list price in Jan 2016 was €52k and the 'trade-in' offer is €39k from the same dealer).

Model choice is based on trying to maintain same spec as 520d SE and similar to current monthly payments. I just need to inject €5k deposit to start a new 3-year PCP.

B. Skoda Kodiaq: I like the look of this and prefer an SUV option to the MPV style. But how badly stung will I be for terminating a PCP after one year? Assuming the Kodiaq model is suitable and is the same or less than the €44,500, do you think it is a bad move to "downgrade" from a "premium"?

All things being equal, if the Guaranteed Future Value of both is around the same, is that enough assurance I won't be taking a big hit for changing brands?

Would you have any other suggestions of 7-seater options? I had briefly thought about the Hyundai Santa Fe and the Kia Sorrento.

Aidan: Does your wife drive? If she does, then might it be easier to change her car to a seven-seater (or a big five seat MPV like the Ford C-Max)? It would certainly be the path of least resistance and seven seats might be a touch superfluous. Your BMW dealer has provided you with an option and it sounds like a good one to me. It's clean and transparent. Nothing wrong with the 2 Series Gran Tourer either. If you get one with the ZF automatic gearbox, you have a sweet machine. The missing piece in this puzzle is whatever deal a Skoda dealer will offer you on a new Kodiaq. To terminate your PCP deal early and move brand, the settlement figure needs to be repaid.

The problem with moving to another brand so early is that the car might not yet be in a position where the trade-in value to a competitor is at a level which is higher than your settlement figure. In short, you could be in negative equity. If that is the case, you will have to make up the shortfall and this means you might need to pay more to change into the Skoda. You won't know for certain until you check. Prices for the Kodiaq have just been released; the equivalent seven seat model at around €45,000 is the range-topping 2.0 TDi Style 190bhp DSG 4x4 model. As for comparing both cars; the only true test is to drive both of them. I think you will be surprised by the refinement and quality of the Skoda product. However, I think the 2 Series deal will transpire as the most cost-effective.

Eddie: My heart says buy the Kodiaq; my pocket says stick with BMW. You are understandably focussed on premium v mainstream, but the Kodiaq is an excellent buy and has an upmarket interior. The thing I liked most about the pricing structure is that the 7-seater version costs only €1,000 more than the 5-seaters. Your PCP is an obstacle if you switch, no doubt. Both are excellent buys; there is more room in the Skoda. Anyway, here's the game-plan: Try and see. What have you to lose? Lay your cards on the table with your BMW and Skoda outlets. All you need to know is how much it will cost you to change and what your PCP repayments will be. Aidan and I will have a private bet on which one you'll choose. Let us know.

I drive a 2004 Honda Accord 2.2l CDTi. The car has 234,000 miles (approx 20k miles/year). It has been fault-free apart from usual items. I could spend up to €2,000 a year on maintenance and still break even in annual running costs against a new car funded with a car loan of €12,000. And this includes the €980 annual road tax on my current Accord.

Of course I would like a newer car but the figures don't seem to justify it based on the above reasoning.

I don't presume any value in my current car as a resale, so I'd be looking at full financing. It would be hard to justify spending more than €200 a month on a loan.

We're a family of four. We're into sports including surfing and I climb/mountaineer and scuba dive. As a result we don't just pack for overnights but also might have bags/rucksacks/boots to cover the range of sports and potential weather for the weekend, so a big boot is essential. Any advice?

Aidan: I know what you mean about finding it hard to give up the Accord. So, how about this? Put a date in your diary when you will get rid of it: once the car reaches 250,000 miles?

Now you have a deadline. In my experience, people work better to them. I am worried that you will need to finance the entire amount of a replacement car and wanting to limit your repayments to around €200/month won't buy you much. You should always reduce your loan risk as much as possible, so use the intervening time between now and 250,000 miles to save as much as you can (by your mileage, you've got around 12 months). I know, easier said than done. But that way, you can probably stretch a bit further with your budget. When you do change, why not get another Accord? They're discontinued now, but the newer model from yours is a beauty. Or get a Peugeot 508 SW or Mondeo estate and opt for the 2.0 litre engine in either.

Eddie: Trade it against a newer Accord as soon as you can. Get cracking on tracking a few down. Buy from an established outlet. If there's a Honda dealership nearby, tell them what you want and what you can afford.

Someone, somewhere has a well-minded, low-mileage Accord. Make it yours.

JUST TO SAY

We love getting your enquiries, but can't reply to all queries in as full a manner as this due to time and space restraints. We try to deal with as many as possible via email. But you can help us help you if you make sure to include the following critical elements in your query:

* Total budget.

* Annual mileage.

*Size of car required (number of seats).

* Present car (make, model, year and mileage).

ecunningham@independent.ie

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