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I seem to be in a minority position of actually expecting APs to drop. Motability increased most prices quite heavily in Q2 which could be to cover the cost of VAT to them for cars delivered after July 1st. If that’s the case and the cost cutting measures genuinely cover the additional costs imposed, we should see a drop or even a considerable drop in APs.
If I’m right, then everything that went up considerably for Q2 should drop for Q3.
I also think there may have been some cars that dropped off the scheme because the AP was too big after the intended increases so either Motability pulled them as being over £8k or the manufacturer didn’t want them at too high a price. They could return.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
I'll try to give my honest opinion but am always open to learning.Mark
I honestly haven’t got a clue this time, but believe there is some truth in what Mark is saying! Although, if that is turns out to be true, I disagree in principle of VAT being added before the initial date set by the government. Surely it should be vehicles ordered on or after 1st July are subject to VAT and not those delivered?
I’m not quite as optimistic as @MFillingham in thinking that all APs will drop, possibly substantially, but I don’t think that it will be as bad as many fear.
Whilst I agree that the hikes in APs from April may have been, in part, to cover the additional costs that Motability will incur on all cars ordered in Q2 but delivered in Q3 (given that VAT will apply to all APs paid after 1st July, but Motability has effectively said that they will cover it so that the AP at the time of order is honoured), I don’t think it follows that these hikes will all be reversed from 1st July.
What I do think, however, is that APs are unlikely to all rise by 20%. As with every quarter, there will be unexplained increases and decreases in APs.
We also have to remember that there are only 3 major government imposed changes. The 20% addition to APs is the easy one to measure, but the addition of Insurance Premium Tax is likely to only add something like £30-40 per lease. The forced removal of premium brands (which have better residual values) will effectively push up APs for everyone (as the average car remaining on the scheme will depreciate more now, which is one of the biggest factors in determining APs) but I doubt that this will work out at a significant figure per lease.
Finally, the changes already announced (such as reduced mileage allowance and the exorbitant excess mileage charge) will help offset the impact of the government imposed changes, hence reducing the need for a 20% across the board hike in APs.
Where I still remain confused is Motability’s claim that the impact of the government imposed changes equates to around £1,100 per lease. This could only be the case if the average AP paid is over £5,000 which is clearly not the case. I’m calling BS on that figure unless they (or anyone else) can convince me otherwise by explaining how they have come to that figure!
I honestly haven’t got a clue this time, but believe there is some truth in what Mark is saying! Although, if that is turns out to be true, I disagree in principle of VAT being added before the initial date set by the government. Surely it should be vehicles ordered on or after 1st July are subject to VAT and not those delivered?
It’s a corporate vs person thing. We are on a promise that the AP we agreed to at the time of order is the AP we pay. However, the Treasury applies VAT on completed transactions, they’ve no reason to exclude vehicles delivered after that date but ordered by us beforehand, plus it would be an administrative nightmare given some could be delayed by a matter of 6 months or more having possibly been ordered June 30th.
All this comes as a combination of applied knowledge with a chunk of conjecture, so I could be utterly wrong but the theory is there.
@Glos_Guy I’m definitely not expecting all to reduce as some didn’t increase last quarter. However, if we take a ‘base rate’ of current costs less applied savings then apply any movement through changes in negotiated discounts from manufacturers and we will have the new quarter pricing. So it could be that a car that went up by £1k last quarter to £3k would reduce to a base price of 2k but then the manufacturer has decided that it’s doing well enough and reduces its discount by £1,500 so the end AP would be £3,500 an overall increase of only £500 as we look at it. Does that make sense?
If it helps, I’m equally as cynical about the claimed £1,100 extra cost whether it’s as an average or ’typical’ increase or a whole scheme cost. When first announced they said the average cost was going to be £400 yet a few months later it’s nearly tripled and we’re supposed to just accept that? Not a hope.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
I'll try to give my honest opinion but am always open to learning.Mark
Personally I believe there will only be a slight increase in AP
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
I also think we will see sone reductions in APs but possibly some increases to.
Sone factors
The governments ev grants and ceiling
Residual value changes, especially on chinese cwrs, which have joined the scheme, plus new cars this quarter and value changes
Car manufacturers wanting to move certain models, either to get them seen like MG, or to clear production stock which is changing with August model year changes, or model end of life.
Can they keep cars at £5 or £6 k? Possibly as we don’t know manufacturers thinking re second hand market
We should start to see leaked prices next week I hope….
The flaw in that logic is that under VAT Notice 1002 leases for WAVs and cars with signifcant adaptations are legally VAT exempt. If Motability inflated Q2 APs across the board to cover the July changes they would be penalizing adapted users who legally do not owe this tax. I doubt APs will decrease but if they do it will raise big questions about why exempt users paid an inflated price during Q2. But I have a feel this will already been factored in and mean that they likely wont decrease for this reason
I also think we will see sone reductions in APs but possibly some increases to. Sone factors The governments ev grants and ceiling Residual value changes, especially on chinese cwrs, which have joined the scheme, plus new cars this quarter and value changes Car manufacturers wanting to move certain models, either to get them seen like MG, or to clear production stock which is changing with August model year changes, or model end of life. Can they keep cars at £5 or £6 k? Possibly as we don’t know manufacturers thinking re second hand market We should start to see leaked prices next week I hope….
I am going to agree with you, manufacturers are up against the Chinese subsidised competition , several EU manufacturers are already decreasing their prices
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
If the Skoda Enyaq 85x sportline Maxx is anything to go by AP’s going up!
Last quarter it was £6500, then it was removed start of this quarter, returned to scheme in the last week @ £7749!
I don’t need all those extras, or should I say, I am not willing to pay the extra for them. I am looking at the SEL 85 at present £1999, next quarter I would imagine it will jump to £2400
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
@LUFC maybe the situation was that it dropped off because it was inflated beyond the £8,000 limit and Skoda added an extra discount to bring it below that point. To me that isn’t really any indication of future APs more a case of Skoda dealing with the pricing Motability created.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
I'll try to give my honest opinion but am always open to learning.Mark
The difference is MY26 and MY27 models
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
The 85 Sportline is now £6549 was 5k Q1, that’s the same AP the 85x Sportline Maxx was in Q1.
So a £1549 increase in AP and you don’t get 2 grands worth of Maxx pack or 4×4 in Q2.
Im not 100% but wasn’t the SEL £749 in Q1 now it’s £1999?
I only use the Enyaq 85x as an example as increasing AP as it’s the car I’ve watched and ordered.
Maybe it’s just a Skoda thing adding 1k+ to AP, let’s hope so!
Yes. the SEL was £749 then jumped to £1999.
There’s no way I’ll be getting another 85x or even an SEL at those prices. Toyota Urban Cruiser will get me from A to B for £0 AP (at the moment) and it has a heat pump as standard!. It’s only available in design trim at the moment but I wouldn’t mind paying extra for the Excel trim if they brought it on.
I know Suzuki have the same car on the scheme in both trim levels but I’m not paying their inflated APs (£499/£2699) for just a different badge.
Please excuse spelling/typos. Apart from being a clot it turns out I had one on my cerebellum that's now causing various problems!
The 85 Sportline is now £6549 was 5k Q1, that’s the same AP the 85x Sportline Maxx was in Q1. So a £1549 increase in AP and you don’t get 2 grands worth of Maxx pack or 4×4 in Q2. Im not 100% but wasn’t the SEL £749 in Q1 now it’s £1999? I only use the Enyaq 85x as an example as increasing AP as it’s the car I’ve watched and ordered. Maybe it’s just a Skoda thing adding 1k+ to AP, let’s hope so!
Thats relatively typical of what happened but, when you take into account their valuation of £1,100 for the proposed changes, that makes sense. However, if that is the reason and if the measures genuinely work, with nothing else changing they should drop back to somewhere around £800. Then there’s any adjustments that would happen around each quarter anyway.
What makes all this difficult is that all we get to see is the new AP, with no clue what has happened between manufacturers and Motability and with the internal calculations. We might see some prices drop dramatically but without insight we can’t tell if it’s purely the measure or a manufacturer deciding to push that model this quarter.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
I'll try to give my honest opinion but am always open to learning.Mark
I spoke with a BYD salesman yesterday (Saturday) and we were discussing the MB changes. He said that they are bringing in a cap on Vehicle prices for every manaufacturer of £40K. I think that would severely limit the EV market that they are trying so hard to get people into.
If that is the case you will have more people leaving the scheme.
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
Once they have damaged the vehicle industry they will increase their prices. To be honest I would not trust the word of the salesman.
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
Once they have damaged the vehicle industry they will increase their prices. To be honest I would not trust the word of the salesman.
Just letting everyone know what he said…
To be honest I would not trust the word of the salesman.
You can still find the Arthur Daley’s out there. I came across a classic last week, all he needed was the sheepskin coat and trilby.
Once they have damaged the vehicle industry they will increase their prices. To be honest I would not trust the word of the salesman.
Just letting everyone know what he said…
Are local Kia dealer assured they have never had a single problem with the EV AC chargers, however Kia have now extended the warranty on the AC charges
Unfortunately I have suffered a brain injury and occasionally I get confused and often say the wrong thing.
I spoke with a BYD salesman yesterday (Saturday) and we were discussing the MB changes. He said that they are bringing in a cap on Vehicle prices for every manaufacturer of £40K. I think that would severely limit the EV market that they are trying so hard to get people into.
I very much doubt that’s true. Sadly, the way that vehicle prices have rocketed in recent years (with the forced addition of technology that many of us would rather not have 🙄), you don’t get a lot for £40k these days, especially for those who need a larger car for wheelchairs / scooters etc.
Price caps have always been senseless, as Motability don’t pay anything like the list prices anyway. With VAT & first year VED (showroom tax) deducted, even before their fleet negotiating kicks in, the total discounts that they get are absolutely enormous. I have managed to negotiate a near 40% discount on a new car (factory order, not an in stock vehicle) and I’m just negotiating buying one car – and it’s not an EV where even bigger discounts are available.
Price caps do nothing other than to pacify those who spout the ‘free luxury cars’ clap trap but, then again, the same argument could be made about the removal of premium brands and Motability rolled over on that one! I do feel though that if there was any truth in the £40k cap it would have been announced with all the other changes taking effect from 1st July. Bad news is best announced in one go rather than death by a thousand cuts!
Once they have damaged the vehicle industry they will increase their prices. To be honest I would not trust the word of the salesman.
If BYD had chosen to build in the UK they would have had to increase prices just to pay for the electricity bill, so chose Hungary instead lol
July’s AP’s are going to need a two tier AP system for PIP customers, as Motability will have to show the AP price including the 20% vat included. But they will have to also show an AP price for customer’s who are going to be vat exempt, due to them having permanent adaptions on their non wav cars.
It would appear that Government are not worried about being legally challenged under the Equality Act2010. But this in part seems to be on the bases that Motability cars are used solely for the benefit of the disabled person as a collective body and they are not being disadvantaged by the new rules as individuals.
However I would think that this could be challenged by a Motability disabled person living on their own with the sole use of the Motability car and justifiably needing a larger more suitable car with a AP or higher AP to meet their disability need, which are only restricted by the amount of their benefit.
I do not see what evidence the Government or Motability have shown to make any reasonable adjustment under the Equality Act 2010, to meet each individual customer’s needs.
Also if Motability are no longer getting the same tax benefits over commercial companies and can no longer fully meet all their customer’s needs, then should they continue to have a monopoly of being the only non charity company that the pip claimant can get their pip allowance paid directly too.
PS sorry if someone else has now covered this, as it now takes me so long to type.
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