Tuesday 20 August 2019

The 10 most frequently asked questions when buying a new or a used car

Aidan Timmons and Eddie Cunningham help tease out the answers

Buying a car raises a lot of questions
Buying a car raises a lot of questions

We get an extraordinary number of queries each week - and are delighted to deal with them.

Only a handful are published in our Wednesday Motors Supplement to give a flavour or aggregate of the questions we receive. But we do deal with the vast majority privately and, more briefly, via email.

Throughout the year, some constant themes have emerged. And we feel it would be helpful to many of you to run through them at this juncture.

1. Should I buy here or in the North?

Eddie: This is an ever-present question - understandably. My advice is to go where the value is. It is hard to argue with some of the savings we hear about.

At the same time, there have been several occasions where we found the figures didn't stack up quite so dramatically in favour of imports.

Aidan always says, why not give your local dealer a chance anyway? And it is good advice. But the figures don't lie and more than 90,000 used imports are destined to have hit the Irish market before the end of the year. My advice is, follow the money, at home or abroad.

2. Should I trade-in or sell privately?

Aidan: This can be less of a money issue and more of a convenience consideration. If you want to wrap the deal in one fell swoop, then trade in your car.

Too many people forget to value the time and effort it takes to sell their own cars. If you have an older car or something with higher-than-average mileage that might be penalised by trading it in, then sell it privately.

To add to Eddie's point above, if you are buying a car in the UK, then you need to sell your car privately here. I have heard of savings that were made by buying abroad being totally eroded by the time the customer off-loaded their car back at home.

Don't assume you are getting a bad deal by trading in a car. It can work in your favour.

3. Diesel or petrol?

Eddie: You can imagine this has been one of the hottest topics all year. Obviously, different scenarios apply, but in general I'm convinced there is a way of coming to a fairly clear-cut decision.

If you are travelling more than 15,000kms a year and live in a rural area and/or commute, diesel has to be the frontrunner.

I can make a case for a petrol hybrid in such circumstances too. The higher the mileage, the more diesel makes a case. If you do under 15,000km a year and live in an urban area, then a petrol, or petrol hybrid, makes far more sense.

In some cases, an electric vehicle will work. If you find this a bit simplistic, I'm sorry, but at least it's a starting point for you to gauge which power source to choose.

4. To PCP or not to PCP?

Aidan: PCP is just a finance product like any other; it either suits you or it doesn't.

Familiarise yourself with the ins and outs of terms such as 'guaranteed minimum future value' and 'equity' before you commit.

The terminology can be a barrier for some people. Walk, don't run, your way through the literature and the potential outcomes at the end of the loan agreement.

Pay strict attention to the level of deposit you use on day one. If you change your car regularly and want to stay in something that is always a fresh model with new technology and the latest safety features, then PCP might be for you.

5. Should I buy a hybrid or an electric car?

Eddie: This has been partially explained in Q3, but we get a lot of such queries, so let's deal with it separately.

Many people want to get out of diesel cars for a variety of reasons: lower mileage, health-linked reports, fears trade-in values will fade and so on.

Hybrids are at their best on shorter journeys and in stop-start traffic, because the battery provides most of the power needed.

The petrol engine kicks in more on longer journeys, but some impressive figures have been returned too.

Electric vehicle range is expanding (with my recent Renault ZOE adventure proving you can do Dublin-Galway on one charge). But it is still an urban car. If you have a small commute, ease of charging and don't fret about having to drive to Mayo every weekend, an electric vehicle is a real option.

6. Why do trade-in values vary so much? Am I being ripped off?

Aidan: Trade-in value is only a small part of the deal. What you really need to know is the cost to change.

Let me explain. Say Dealer A is selling a car for €10,000 and he/she values your car at €4,500. You might feel insulted that Dealer A considers your car to be worth so little, so you go to Dealer B.

This dealer is selling a car for €10,750 and thinks that your car is worth €5,250.

It is simple mathematics to see that both deals are stacked the exact same way; both dealers want €5,500 from you to buy their cars i.e: €5,500 is your cost to change.

However, many people prefer the optics of Dealer B's deal as it flatters the trade-in more. Forget the optics and focus on the maths. But make sure you value a good relationship with a dealer who will loan you a car if you get stuck, or help you out with warranty work, too.

Be actuarial about buying a car, but not too robotic.

7. Please advise me: I need a seven-seater

Eddie: This is one of the growth areas, as far as we can see. People seem to need more space for growing families.

They may not require seven seats all the time, maybe only a few times a month, but they need them all the same. And they need the room when the third row is not in use. Aidan and I mix and match our advice in this area, because there are still some excellent seven-seater people carriers out there, as well as quite a few newer seven-seat SUVs coming, or on, the market.

We always try to warn people that buying one secondhand needs extra inspection of key areas such as seats, tailgate/boot area etc, because families can wreak a fair bit of wear and tear.

It is also important to check out ISOFIX points, flexibility, accessibility, as well as clutch, brakes and engine - all can take a hammering in the course of a family's everyday comings and goings.

8. SUV/crossover, saloon/hatchback or estate?

Aidan: Eddie and I tend to offer a broad range of options, but questions to Motors increasingly centre on the desire for SUVs.

However, if you want some of the best value in the market right now, then opt for a saloon. If you have trouble getting in and out of a car or carry elderly passengers, then mid-size SUVs are a good option.

Compact SUVs are sprouting from everywhere, so if you are in a supermini but want extra height without wanting to get into a large car, you should have plenty of choice in the new end of the market. Less so with used cars.

Estates are far too under appreciated in this country. They make sense for a large portion of our readers. Don't rule one out on looks alone.

As for hatchbacks, you can never go wrong if you need a spacious second family car. Whenever there is fierce competition between a number of brands and models you can bet on getting a good deal - and hatchbacks are among the best represented in the market.

4. Should I buy now, or wait until next year?

Eddie: It's getting a bit late now, but this query has been cropping up a lot since the end of July.

If buying a new car, the answer is obvious. Wait. If buying used, our advice always is that if you come across a car that really suits you, then go with it.

People think holding off means they'll get a used car cheaper in January. Only thing is, your own car is a year older too.

Right now there are some good deals out there - the level of imports has knocked money off everything.

Late January/early February is a good time too.

10. Should I buy a new car or opt for a two or three-year-old? I'm horrified by the amount of value lost in a car over the first couple of years of its life.

Aidan: To borrow one of Eddie's favourite terms, this one is 'horses for courses'. The merits of buying a new car are that you get the full extent of a manufacturer's warranty, can pick the colour, specification and model that you prefer and, in recent years, borrow money at extremely low, even zero, percentage rates.

Also, over the last few years new car buyers were thin on the ground, so they were treated favourably with their costs to change.

Depreciation typically works on an ever-decreasing scale. As a car ages, depreciation slows down.

If you are frightened of the drop in year one or two, then opt for a used car. Just be sure to get something with a warranty and a comprehensive service record.

Used cars are inherently more risky than new vehicles.

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