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I went for lunch with some mates today and had a 1 hour journey each way on the motorway. It really struck me that a huge number of the cars that I saw on the journey were brands that didn’t even exist a few years ago (at least in the U.K.). As not a single one of them even remotely interests me, I have absolutely no idea how many of them were EVs, PHEVs or ICE cars, but I have never seen such a huge change in the types of cars on our roads in such a short period of time.
Given that the vast majority of people aren’t particularly in to cars and see them as a necessary evil to get from A to B, preferably as cheaply as possible and in comfort, it is no wonder that these new (mostly Chinese or Far Eastern) brands, offering well equipped cars at (relatively) cheap prices, are swamping the market for those who insist on having a brand new car. Add into the mix the problems that traditional manufacturers are having trying to get EV sales even remotely near to government targets and it’s no wonder that Nissan and others are experiencing problems!
Thanks for updating @TomThumb I really feel for your daughter. Nothing worse than uncertainty.
Sorry to hear about your problems. When Motability used to allow us to buy cars at lease end the prices that they asked were stupidly high, especially for a car sold with no warranty. The main reason was that they were trying to deter people from leaving the scheme.
I would assume that the prices that they quote dealers are much lower, but the dealer will still need to cover their margin and warranty cost, so they will obviously want more from you than they pay for the car
I notice that you have a BMW i4 which, being a Motability car will be the entry 35 model. As second hand EV values are so low, and given that the vast majority of i4 buyers go for the more powerful variants, you may well find that you can do better by just buying another used one. There are currently 418 second hand I4s on Autotrader and only 80 of them are the 35 model, the other 338 being the more powerful variants. Worth a look as I’m sure there are a number in your exact spec!
As others have said, it’s a case of doing some number crunching. It’s not just EVs with extended servicing periods, as many ICE cars don’t need annual services these days either. Even the high performed petrol car that I’m buying doesn’t need anything doing until 2 years or 12k miles (whichever comes first) and even then it’s just an oil change!
I am buying a 5 year servicing pack, but only because with the VAT knocked off, plus the discount I negotiated, I got almost 40% discount on it. The pack is also transferable to the next owner, so if I decided to sell the car before the 5 years it will improve the residual value and make it easier to sell. I’m also buying the car outright, rather than leasing, so want to ensure that it gets every required bit of attention at a main franchised dealer, which also helps resale value.
If I was leasing, I would call the service department of a franchised dealer as they can tell you which services will be required over the 3 years and how much they all are currently, but keep in mind that prices tend to go up each year. You can then weigh that up against how much extra the leasing company is charging over the lease period. I doubt that you’d need to worry about breakdown cover. I can’t think of any manufacturer that doesn’t include breakdown cover as part of the manufacturer warranty but, again, double check.
@TomThumb It’s over a month since your last update. Has there still not been a resolution?
Motability really do need to decide what their policy is regarding extensions and stick to it. The policy has changed multiple times, with no communication, and implementation of it seems to depend on who you speak to ;
Firstly, anyone could extend by 1 or 2 years. Next they restricted the ability to seek an extension to those who had done very low mileage (under 20k in 3 years from memory) or had expensive adaptations. Then this was also stopped with no extensions allowed (other than 3 months). However, at every stage, some people got extensions and others didn’t, with no rhyme nor reason as to why.
I was under the impression that the policy was still that extensions weren’t allowed, yet @Oscarmax is granted one with 19k miles (but only for 12 months) yet @JSM1976 is refused one with half that mileage. It makes no sense. If I wanted an extension (which I don’t) I’d keep calling Motability until I eventually got someone who agreed to it 😂
@kdwolf I must be misunderstanding your post entirely because, whilst I do not know the answers to your questions, I do know that none of them are at all relevant to Motability, so I am unclear as to the relevance of the questions.
As stated, Motability’s position re VAT is entirely different to that of a commercial leasing company. They do not pay the VAT on the lease in the first place, so have nothing to claim back, so you cannot compare the two. As I say, I must be missing something!
There’s a difference between the treatment of corporate VAT and a VAT Exemption. A lease company buys a car for £60,000 they pay the supplier that £60,000 but the accountants regard the 20%VAT as having been paid to the Treasury. When they lease the car the payments are £1,000 + VAT which means the payment of £1,200 goes to the company.
So unlike me for example, where I can reclaim VAT on invoices for being VAT registered and charge VAT on invoiced work, lease companies etc can’t reclaim VAT on goods (car) invoice?
As per my last post, I think the fundamental difference is that Motability don’t pay the VAT in the first place, so don’t need to reclaim it.
It’s the same with my new private car. I’m not paying the VAT and then reclaiming it. I’m just not paying it at the point of purchase.
VAT exemption is a very different process to being VAT registered.
I don’t think that they pay the VAT and reclaim it. They have a block exemption, so don’t pay it in the first place. That remains after 1st July.
As from July, the APs only will be subject to VAT. We don’t know yet whether the entirety of that 20% will be passed on to us.
Finally, keep in mind that Motability don’t just benefit from VAT exemption. They will get substantial discounts as well. I’d hazzard a guess that the discounts are on average around 20% on ICE cars and probably more like 30% on EVs. This will be in addition to the VAT exemption.
On modern cars, which Motability cars are, making or receiving a phone call whilst driving is perfectly safe and legal, as long as you are using hands free. By using voice control and / or steering wheel buttons, you can make and receive calls without taking your hands off the wheel. Are they saying that with DriveSmart this would still mark you down?
@Joe If you just want the info on claims history, DLM will give you that info over the phone. It’s only providing the driving history in writing (email or letter) that, for reasons known only to them, that they restrict to one request only (per year or per lease – can’t recall which).
@Harrysback Also worth remembering that if you buy a new car there are deals to be had on servicing packages. As we were talking Skoda, I noticed that they do a 2 year servicing offer for £249. New car warranties (which are at least 3 years in duration) include breakdown cover, as well as anything that goes wrong on the car. I rarely get through more than 2 tyres in 3 years on a new car. We are 15k miles into a PHEV (heavy car) and the 4 original tyres still have plenty of tread. Insurance can indeed be a significant cost for some, but your driving record with Motability acts pretty much the same as No Claims Discount in giving a healthy discount. Insurance also covers windscreens (albeit with an excess).
Motability have always traded on “worry free motoring” but that has always come at a cost. Nowadays, that cost is substantial and becoming questionable, with the sole possible exception of EVs. Also, even leaving aside that it can be cheaper to go elsewhere, some of the changes that Motability are introducing not only remove the ‘worry free’ tag, but go the other way!
I just had a quick look on Drive the Deal. Current discount on the Kodak SE PHEV is £7.5k and the SE-L £7.8k. These figures include a £2,750 finance discount if you take out their PCP. If you take out the interest free deal then the discounts are reduced by around £3k, but that still leaves around £4.5k discount to be had even when taking out the interest free credit. The dealer seems to be chancing their arm claiming that there is no additional discount to be had if you take out the interest free loan, as that’s clearly not the case.
The BMW dealer that I’m buying my new car from doesn’t work with Drive the Deal, but I still used their prices as a basis for my negotiations and they matched the Drive the Deal price which, in my case, was over £16k discount, only £3k of which was a BMW U.K. discount. I’m not taking out any finance, so the discount wasn’t conditional upon anything. I think that CarWow and What Car discounts were around £6k less than I managed to achieve.
I’ve not really looked at leasing as I buy cars rather than lease them, but the ‘deals’ that they offer on buying new cars are pathetic compared to what you can actually achieve direct. Same with What Car etc no doubt due to the huge commissions that they take as a middle man. I wonder if it’s the same with leasing? Maybe there are even better deals to be had going direct to the leasing companies?
When looking at the profit of Motability Operations, it’s always worth keeping in mind that their profit is after the payment of their excessive salaries and benefits (at all levels, not just the CEO). If they paid in line with the sector average then this profit would be several times this amount. All of which, of course, is funded by disabled people sacrificing their benefits.
@MFillingham Thanks for the further clarification. I was confused when you initially said that there won’t be an option after 1st July to ask the dealer to cancel and reorder if the AP drops.
As you have said, any orders placed after 1st July will be on the lower mileage limits and won’t include European cover, but for the majority of customers who do less than 10k a year and don’t drive their car abroad, it will still be worth considering asking the dealer to alter the order on the Motability system if the AP drops, as these two changes won’t affect them. Worth noting (for those who may be unaware) that this doesn’t affect the delivery date, given that the actual vehicle order is completely separate to the Motability system and is unaffected by any AP alteration.
You must take your Motability PIN number with you. I think you need to take your driving licence with you as well, plus obviously the means to pay any outstanding AP / cost of adaptations. Dealers won’t accept credit cards, so take your debit card.
Prior to entering your PIN, it is essential to check that the car is exactly the precise model and specification that you ordered and has any optional extras that you ordered. Once you enter your PIN you have accepted the car as seen. You can reject the car prior to entering your PIN if the car isn’t right, as your contract only commences when you input the PIN.
Most of all, enjoy your car!
Further to my last post, this is from the FAQ on the Motability website DriveSmart page;
You’re considered a first-time customer if:
You’ve never leased through the Motability Scheme before
Your last lease ended more than seven years ago
This is because we delete your personal data after seven years, in line with our privacy policy.As with everything, this may obviously change in the future but as per the new rules, anyone who leaves Motability but rejoins within 7 years will not be required to have a DriveSmart box (unless a driver is under 30).
I am due to change 10th August my window opens 9th May, if you cancel your order, you will classed as a new customer, Mobility will fit a Smart Drive, so make sure you make the right decision.
I don’t believe that’s correct for two reasons. Lowering an AP doesn’t stop you from being a Motability customer, as you already have your existing car, so there is no break in being a customer. It’s just a 5 minute admin job and affects nothing else
Secondly, and I appreciate that this might change in the future, but Motability are saying that a ‘new customer’ is someone who has no previous history of being a Motability customer. Under the conditions that they have recently announced about SmartDrive, someone who has left Motability and rejoins at a later date will not count as a ‘new customer’.
Your friends can order from the date that their order window opens, which is shown on their online account. Motability are very good at sending out the letters confirming this, but they don’t have to have received the letter to order, as long as their order window has opened.
If there is a car that they like and they are happy with the AP then they’d be daft not to order in June. Their AP will be locked at that level, regardless of when the car arrives, and they will be exempt from most of the adverse changes kicking in from July.
Personally, I don’t think that all APs will go up by 20% in July. Two reasons. Firstly, a number of the adverse changes being implemented are to help absorb the impact of the government imposed taxation of Motability, in order to soften the blow to APs. Secondly, with the AP hikes we have seen in recent months, especially this quarter, it looks as though they have already started to cost in some of the increases (on the basis that Motability will have to cover the tax liability themselves for cars ordered now but delivered after July).
Whilst it is unlikely that many APs will drop in July, some still might. APs can vary by large amounts quarter to quarter and changes in excess of 20% (i.e bigger than the VAT hit) are common. @MFillingham what changes from 1st July to stop dealers who are prepared to alter the AP from doing so? Motability have never liked them doing it, but many do.
kezo & Glos Guy Are you still going to contribute to the Forum, If not can I thank you both for your invaluable contribution’s over the years. If you go, you will both be sadly missed.
Thank you for your kind words. Like @kezo I will still check in from time to time. After many years with Motability I shall remain interested in how the scheme evolves
@kezo Have you handed your Tucson back already? I guess you didn’t need to wait for your new car like I’m having to, as you have the BMW to get you around?
Yes this morning
We spoke over the weekend on if and how we could mange with BMW and phoned yesterday saying I would drop it off today.Well done on two counts. Firstly the extra £330 every 4 weeks will come in very useful and secondly, no longer being subjected to the Nanny Statery of Hyundai’s incessant bings and ruddy bongs will be a blessed relief 😅
I will have to put up with it for another few months as the new car is still showing July delivery 😞
@kezo Have you handed your Tucson back already? I guess you didn’t need to wait for your new car like I’m having to, as you have the BMW to get you around?
We spoke over the weekend on if and how we could mange with BMW and phoned yesterday saying I would drop it off today.