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There will be quite a few but there are too many for whom the Scheme is the only way to a suitable car.
The more that walk away, profits for MO will reduce significantly, that reduces the donations to the Foundation which then impacts those needing grants. I wouldn’t be surprised if at some stage the grants will only be available for WAVs. Without Grants for disabled customers who can’t afford the APs that would then reduce customer numbers further.
With no further changes I can see Motability becoming a fraction of what it is now within 5 years. That said, there’s an Election due in 3 years, if the Conservatives win then PIP will become a focus of excessive cost cutting. If Reform win they’re talking about significant changes to the scheme and PIP. That will mean that by 2031 both PIP and Motability will look very different from 2027.
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
After a conversation I had with my mp, I’d guarantee that it’s coming in for everyone. Politicians are under the impression that the Drive Smart system will cut out all misuse. Whether that’s fed from senior Politicians or Motability I’ve no idea but there’s quite a few who have been fed that combined propaganda of there being lots of people abusing the scheme and that Drive Smart will, somehow, catch everyone out.
I'm Autistic, if I say something you find offensive, please let me know, I can guarantee it was unintentional.
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Well done Mark. It seems as though you covered the majority of important points. Just to add a little whimsical madness, I saw a Facebook post a few hours ago, where Drive Smart had tracked a Motability user around Tesco’s. If that doesn’t demonstrate that this ridiculous App is not fit for purpose, I don’t know what will.
Were they speeding? Sudden stops must have been a factor😂
I came out feeling like I missed too much but, having thought about it, I managed enough to get him to look at it.
I still feel there’s an injustice between giving people on very large salaries 40-45% off leasing their car whilst making Motability customers feel like second class citizens.
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I'll try to give my honest opinion but am always open to learning.Mark
Update:
Always know your audience. As an MP who fully backs fairness and has lapped up all he’s been told, he feels there’s far too much misuse of the scheme and Drive Smart will solve that issue. However, he was surprised to hear the full detail of the impact it’ll have on our lives. He will look for clarity on the 6 journeys as he sees my point about not being suitable for disabled people’s use. The big one for him, though, was the 1 hour driving. He’s very keen on rural communities being disadvantaged and that’s very relevant to this limitation. If you live in some villages on the Cornish coast the main hospital is over an hour away and with hospitals having regional specialties sometimes you have to go to Plymouth which means his entire constituency is unable to avoid the red marks for each direction.
I also pointed out that the system doesn’t care who’s driving, if your phone thinks you’re driving then it’ll report your journey, which means a taxi driver who’s a maniac could ruin your week.
I also pointed out the unfair balance between BEV and combustion engined cars, specifically the Sportage/EV5 comparison at 2800 difference and MGs HS/S6 at 5300. He has read an article in Autotrader that suggests lease companies will be reducing the cost of leasing imminently. He did ask me to get back to him if October’s pricing is still unaffordable.
He was surprised that despite being told there are cars suitable for nearly everyone at nil or very low AP I said the very cheapest suitable car for me was at £2,999 this quarter and £1,999 last.
It does seem that the force behind these changes isn’t Motability but the elected officials.
Unfortunately 15 minutes really doesn’t last very long while you’ve a lot of points to make. I ran out of time before making a point about the commercial option giving choices while Motability has a take it or leave it policy.
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I'll try to give my honest opinion but am always open to learning.Mark
Very good! As well as having the choice to except a black box or take higher insurance, its typically up to the age of 25. I find most if not all of the upcoming changes discriminatory because we are being treated unfairly compared to general market.
Not exclusively for the Under 25s. I was looking for an insurance quote for a Model S, seeing as it was relatively cheap and includes free charging for life. The quotes were eye watering and many included a black box. However, I’d be somewhat concerned if the only insurance I could get on a pretty basic EV SUV like the EV5 Air requires a black box. I’d be downright livid if the chosen car was a lifeless, uninspiring box on wheels that I chose because it was all I could afford and still had to have that system fitted.
I think after the initial shock of looking at the measures Motability have taken, it’s the absolute lack of choice that’s most infuriating. There are people who need to be able to do more miles, maybe not 20,000 a year but it’s not hard for me to imagine starting work and suddenly getting to 12-15k annually just by adding a commute 5 days a week.
Then there’s the pure idiocy of the policy. The Chancellor failed to bring in severe measures to force us lazy buggers back to work, now she’s making it impossible to go to work through removing the transport option we rely so heavily upon. It screams of policy by knee-jerk reaction rather than a thought through belief system. Say what you like about Reform but at least you can see where the policies they come up with originated, even Badenoch seems to have a strategic plan for what she wants her party to achieve. Even if you disagree with these policies, whether it’s because you think racism isn’t the policy you want to follow or if your economic education has been less freedom of markets and more ‘don’t screw the little guys’, there is a policy there to disagree with. Labour are busy saying and doing somethings that you’d expect Labour parties of old to do, like the child welfare cap, then they cut off cold weather payments for the elderly or try to go completely right wing and take it out on the disabled.
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@Kezo, yes, that’s on my list of whinging too. Here’s the letter that got me the appointment:
I would be grateful if we could meet in your Camborne Surgery to discuss the impact of the Chancellor’ decision on Motability and its anticipated changes.
I am currently due to change my current Motability car in February next year. That means I have no option but to deal with whatever is implemented as a direct result of the imposition of extra costs. To find a vehicle that meets my needs I have no option without an Advance Payment. Purely for space and drive train, I will have to find money each lease. This is an unfortunate situation that I’m normally happy to pay as I then get a reliable car that doesn’t come with the concern of unexpected immediate expense of a breakdown.
However, it appears that Motability will significantly change the lease terms in order to reduce the impact of the IPT and VAT imposition. So far, Motability have said nothing about what will happen but there are clear indications of their intention. It looks like there will be a reduction in mileage allowance to half the current 20,000 miles per year with a huge 25p per mile penalty for excess miles. It also looks like the dreaded DriveSmart system will be forced upon all customers despite it having forced drivers off the scheme due to dubious results. There’s been numerous examples of the system returning negative marks where the insured wasn’t driving or where the grading and the journey don’t match up. There’s also a matter of customers being penalised for actually using the car as the scheme was intended. To enable independence we are often required to make numerous short trips just to do what able bodied people would do from a single trip. For example, a shopping trip to Truro would be parking around the museum to shop at then of the city centre, parking centrally for the shops in the pedestrianised area decide the library and then parking at or near Lemon Quay for that end of town. So a simple case of me looking for a new pair of shoes is a trip to Truro, a short trip from west to middle, another short trip from middle to Lemon Quay then a trip home. That’s 4 registered trips without going anywhere else. Add in popping to Tesco or the doctors and I’m at my daily limit. Seeing as I also drive my mum to her appointments, 6 journeys will be broken at least once most weeks. With 2 trips to take Sara to work (there and back) 2 to collect her plus a return trip to a medical appointment, it’s ridiculously easy to get a negative score for the number of journeys. Too many negatives and they simply kick you off the scheme and you’re then hit with a case of having insurance withdrawn, which impacts your ability to insure any other vehicle you might get.
In all, the restrictions put on the scheme to reduce the increase in expense caused by the Chancellor’s decision to impose 2 taxes on disabled people’s cars will make the scheme a real risk for many people. I know of many, including myself, who feel forced into looking at alternatives, which are ridiculously limited when I can’t work, just to try and maintain the independence having a reliable car provides.
Please advise when it would be possible to discuss this impact in person.
I’ll also point out that commercial insurance options include an option for a black box or to have the car insured at a higher premium for not having one. An option that, like so many things hasn’t been offered to us.
I’ll definitely be making lots of points on the lack of choice and suitability of the imposed changes as well as stating that the whole policy wasn’t to provide a more affordable mobility system for the end customer but to appease the Right Wing Media and the rhetoric that was spouted by the likes of Tice, Farage and Badenoch. That should piss him off enough. 😀
@shaan200 yes I already have a table of cars that are suitable for me that demonstrates just how unaffordable BEVs are on the scheme and the comparison between the 2 KIAs will definitely make a point of that. I’ll pick out the price of the MGHS too, as that’s comparable with the MGS6 which has joined for a cheap £6499 as opposed to the HS Hybrid+ at £1,299If I have time I will try and get to the hoist thing but as I don’t need one (yet) it’ll be an odd point for me to be making.
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
So, I have been quietly preparing for a meeting tomorrow with my MP. This is going to be interesting as he’s a key figure in the BEV all party parliament group, so pointing out just how awful Motability pricing is for BEVs is definitely on my hit list.
Some key point prepared are:
Q1 cheapest suitable car was £1,999 (Enyaq SEL Plus) Q2 it has changed to the £2,999 EV5 Air
The Ev5 and Sportage are supposedly the same market group, having had KIA and several reviewers say that while the EV5 isn’t an electric Sportage, it’s definitely targeting the same people looking for the same sector car but with a battery. The cheapest Sportage is £199 The cheapest the EV5 has been so far is £2,999 that’s £2,800 just for choosing electric.
I looked at the revenue benefits of bringing the Salary Sacrifice changes forward to the next financial year and that brings in an additional £10bn while all 5 years of VAT and IPT only recovers £1bn. If revenues are the target, not cosying up to the right leaning media, then the NICS on Salary Sacrifice creates significantly more revenue that ruining the Motability scheme for so many people.
There’s also a planned rant on not giving disabled people the choice a commercial lease would offer.
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
In America the Lottery is awarded and then taxed. I would love to see how that works if you win over here
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
It’s worth noting that searching for SUVs will mean you’re not going to see the EV5. The biggest EV on the Scheme is classed as a ‘small hatchback’. 😳 Go figure. 🤷🏻♂️
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I'll try to give my honest opinion but am always open to learning.Mark
The EV3 ICCU issue, as I see it, is still an issue but does come with a solution.
Charging at a full 7.4kW can cause the ICCU to ‘trip’ where it drops the charge rate to trickle. Apparently, stopping the charge and trying later can resolve this once it’s tripped but I’ve seen no clarity on how much later really is. What is clear is that charging at 90% of full rate avoids the whole problem.
There is no sign of the EV5 having any issues with the ICCU, although it’s not been out for long.
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’m not sure there’s any evidence that sales have significantly increased as a direct result of the insanity happening in Iran.
In terms of supply issues, some manufacturers were already beginning to have significant delays and others were reducing supply options to prevent those very delays.
The only reason I can see for some manufacturers to have problems directly related to the war would be if Iran’s puppets close the Suez and shipping has to navigate its way around Africa.
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I'll try to give my honest opinion but am always open to learning.Mark
Have a look on here: http://speakev.com/
It’s a dedicated EV forum and has sections for most cars. If there’s a common theme running for the ipace, it’ll be there.
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
@kezo, illegal, no. If an item that isn’t subject to VAT is added to a product that will be, then VAT will be added to that new product in its entirety. This is what happens when you take insurance and roll it up as a ‘just add fuel’ product. However, if you have a car with suitable adaptations, you should still be able to claim an exclusion from VAT.
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
Seems like motability themselves don’t know what is happening 100% with their own scheme as a full list of responses from them on the FB group says drive smart will be forced on everyone within 3 years, plus no smart phone= forced full black box.
In 20mph Wales, they can stick it where the sun don’t shine!
Best include Cornwall in that too, most towns now have 20 mph limits. It’s a joke, you’ll get many now going slower but still have the idiots charging up and down the same roads at the same speeds that were nowhere near 30 then.
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
Exactly, 20% of whatever AP you have to pay. Anything ordered after 1st July will consist of AP +20% VAT, however Motability claim that their changes should minimise the impact of the tax cost.
I wonder if IPT will form part of the advertised AP and therefore will be subject to further tax, when VAT is added. or It will be added afterwards in conjunction with VAT, thereby adding an additional 32% ontop of the AP or Its buried somewhere and we don’t know if were paying VAT on it. or We assume the advertised AP, has been adjusted correctly to include IPT, in a way it won’t be subject to further VAT. ???
Jeez man, I’m a bloody accountant and that made my head hurt😂😂
Currently, there’s a summation of costs which are added to the purchase price, which includes insurance and maintenance as well as allowances for costs like tyres and breakdowns. Then a prediction of future value is made and subtracted from the total costs. If that figure is less than the sum of 39 benefit payments, there’s no AP. If there’s a lump remaining that would be the AP. Well, that’s the over simplified theory anyway.
Insurance would be an allocation of the total insurance cost for the scheme for 3 years. Which could be 1/910,000th of the total insurance cost. With IPT added, that insurance cost increases, with no regard to whether each vehicle requires an AP. Thus the insurance cost increases by IPT but that increase is not necessarily subject to VAT or excluded from VAT unless the car’s costs are such to require an AP.
Outside of Motability’s odd tax situation, insurance isn’t subject to VAT, just IPT. In theory, that should extend to the scheme. However, when costs are combined in an all inclusive basis, it’s the charge to the customer which includes VAT, which means both insurance and IPT becomes subject to VAT as the calculations to exclude are too complicated for most to bother with.
Therefore, it’s safe to say that the AP will be set in the same way and then VAT applied to whatever the required AP would be. So, as the calculation must include the full, taxed, insurance cost if that pushes the AP up, you will effectively be paying VAT upon the IPT in the same way you pay VAT on duties applied to fuel.
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
What is the VAT payment calculated from, is it the purchase price of the car or the value of lease or something else?
I remember now, the Advance Payment
Exactly, 20% of whatever AP you have to pay. Anything ordered after 1st July will consist of AP +20% VAT, however Motability claim that their changes should minimise the impact of the tax cost.
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
@Rich44 I know you’re not seeking sympathy but man that sucks. I hope you get through all this quickly. Depending upon where the lump is, could that and the neurological symptoms be related?
I’d forgotten about the insurance increases. That just adds to the sucks that this scheme seems to be dragging its way towards.
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
This is absolutely the case and has been said many times, APs are fixed at the point of order, including these changes.
This is why I got messed up elsewhere with the corporate arrangement between Motability Operations and HMRC and the timings of the impact of the changes on customers.
As customers we are in a protected situation where the time of order fixes a lot of things that are less certain in the corporate world.
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
@Callmejohn it’s not exactly the competition that streamlines processes and creates better value, it’s the existing processes that were built for competitive advantage and cost control rather than just generosity for staff.
Yes, @Woodpecker I’m aware of the sad reality that the government have no desire to force change while customers are walking away.
The thing for me is that, outside of the scheme, leasing makes no financial sense. I’d be spending money I really can’t afford on a car I’d never own, without the financial aid of the tax benefits of Motability and without all the support of worry free motoring that we had, just paying £320+ a month just to have a car that works for us makes no sense. There are cars out there that are massively more affordable that are suitable and, if I can stay for the whole of the next lease, there will be a whole bunch of the cars I’m looking at now available used. A 3 years old EV5 would be ideal and very likely to be affordable.
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
Firstly, they will NEVER be on the scheme.
Secondly, they and the Ioniq 9 are huge. There’s a property guy who swaps cars quite regularly and he had an i7 which is massive. The EV9 and Ioniq 9 are proper 7 seat SUVs, something that can’t come in small. I’ve sat in both, I dislike the rear lighting on the Hyundai, it’s enough to tell a whole city block that you’re slowing down. The KIA is nice though, it’d be great in towns but Cornish lanes would be a nightmare.
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
Motability are safe in the very secure world that a complete Monopoly with customers who heavily rely on their service provides. It doesn’t help that the current political climate towards disabled people is less than friendly.
In an ideal world, there would be 2 or 3 existing lease companies that would be given permission to receive the payments directly and that level of competition plus their already streamlined systems would keep costs to a minimum. What we’ve been left with is a bloated inefficient feeding trough for employees, management and the 4 banks running the company.
When you look at the jobs page and see very few people have left and there’s only new and the very occasional replacement job advertised, that shows that everything they offer is more than generous. Add in what you see in the job adverts and it becomes ridiculously clear that the benefits package is extraordinarily generous. Then look at what they have to publish for the people at the top and it’s still a shining example of generosity. The annual statements show the company is a very long way from struggling.
A commercial lease would balance the pay and conditions with staff turnover and pay the minimum they could get away with, the savings would be enormous. Even if the ‘Motability’ type arrangements were made more generous for us customers, including fully covered maintenance and 3 people on the insurance and completely flexible onward travel (including the current hire car provision) I’d guarantee that any of the large scale leasing companies would be able to beat the rates offered by Motability, even if they were the monopoly, add in competition to prevent excess profits and the APs would drop significantly. I’d even bet if put out to tender, there’d be a bunch of suitable companies lobbying on the day the tender was released.
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
@kezo did you read the comments? Proof that a little knowledge can be dangerous.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
If you purchased VAT free goods during the VAT free period and collect & Pay for them after the VAT free period ends, you will be charged VAT on the goods. However, didn’t Motability say they would cover this in their Q&A’s or one of the video’s and may have decided to be sly and hide it in Q2 AP’s? – I wouldn’t put it past them! @Glos-Guy Yes, but as you say yu should be exempt.
So this is the difference between Motability as an organisation and us as individuals. I really should have thought that through, you are always liable for taxes, including VAT on the period within which the goods change ownership. In this case, when the car is delivered and Motability have bought the car. Their price guarantee has, as far as their current messaging is concerned, remained in place, so if I were to order June 30th I wouldn’t be exposed to the VAT increase. However, if someone ordered in March and takes delivery of the car in August, that car will also be liable for VAT as applied on July 1st.
Mark, I’ve already shown that VAT applies to all leases that go in-life after the 1st July earlier in this thread, with evidence. And how applications made before 1st July may end up being subject to VAT. Motabilty has to cover that VAT liability somehow. So, yes, I strongly believe that the April APs are higher, as quite honestly anything else doesn’t make any business sense. My idea for how that may have been done to be equitable to all parties was just that – an idea. But I’ve unintentionally pulled the thread way too far from the original question, and that’s not fair to the OP. So I’ll stop.
I apologise, my somewhat focused mind was fixated on the costs to the customer. As I’ve said above VAT will be recoverable from Motability Ops for all cars where the PIN is entered from July 1st.
@kdwolf cars ordered on the current 60,000 mile contract will be expected to depreciate more than on the new 30,000 one. That is the key saving where Motability won’t have to take such a hit on vehicles that have taken a significant proportion or full allowance. They can also reduce the Insurance Premium as the scheme now allows only 30,000 miles in total, any car after that would be outside of the core contract and subject to an agreed fee for further cover (we remain insured but a chunk of that 25p excess goes to DLM). Those two would very likely reduce scheme costs, which SHOULD be passed on to the customer. A number of people on various FaceBook groups who are in or were in the trade have said that the lower limit will have a significant impact on depreciation, however, that’s only for vehicles that would have gone beyond the 30,000 and how many customers that actually effects will be known only by Motability based on previous disposals.The technical accounting would be something like:
Purchase price less depreciation (to give a disposal value) plus/minus variation on disposal. In most cases, if we believe the 7,500 average, that should be a positive variation. However, if they’ve decided to depreciate at an expected average mileage plus a margin for error (say, 10,000) then a large number of cars would be coming in at a significant loss on disposal, which stands up in their accounts.
To put some (very rough) numbers in:
purchase price 30,000 30,000
Depreciation 15,000 15,000
Adjusted value 15,000 15,000
Mileage on disposal 7,500 60,000
Disposal income 16,000 10,000
Profit (Loss) 1,000 (5,000)
Now multiply that loss by how ever many hundred thousand exceed 10,000 miles and that’s the huge losses on disposal explained away. If they don’t lose 5 million, and share that between us, we might save £500 off current APs.
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
So basically Mobility is going to take the AP VAT hit, hence the AP hike in the second quarter, if these AP stay exactly the same in the third July quarter AP will be plus 20% VAT, WOW.
Possibly not, which was my original point when answering the question posed by the OP (sorry OP for derrailing your thread). Lets say the AP for 1st April should have been £625, no VAT. Motability had 3 options on April 1st: a) Set it at £625 – that means they take a £125 hit on cars delivered after July 1st b) Set it at £750 – that means they fully cover the VAT, and get an extra £125 for cars delivered ahead of 1st July. c) Set it somewhere between £625 and £750. The where will be based on their best guess of how many cars will be delivered before and after, and try to cover all of the after. Given they are trying to save money, and have to cover costs A is almost certainly not true. I personally suspect they have done C, but they may have done B. As APs are sticker prices, and no-one really knows how they are made up it’s impossible to tell. The Enyaq feels like it’s been subjected to at least C. If they have done either B or C, then July 1st won’t show a huge increase; that’s already partly baked in from April 1st.
What?
APs as at April 1st have NOTHING TO DO WITH VAT
APs after the next quarter change will be VAT inclusive unless someone persuades Rachael to do yet another U turn. That means if the AP is £1,200 that’s £1,000 AP and £200 VAT.
What Motability MIGHT be doing is either psychologically softening the blow by making the current quarter’s APs astronomical and then the increases won’t appear to be a flat 20% meaning they can say that their cost saving measures are working. OR they have raised the AP in order to reduce the majority of APs and show that their cost saving measures worked. I suspect they might be working some BS plan where APs drop July 1st and will then increase again 3 months later. Either way, when we look back at what we would have to have paid March 31st 2026 and Dec 31st 2026 the latter will be significantly more for a much less ‘ worry free’ contract.
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
My rather cynical nature thinks the whole reason behind the BS rises this quarter includes a large dose of “we were right” when the prices drop next quarter.
Unfortunately I suspect the 100% lift could well be met with a 70% drop in July and an announcement of success at keeping prices low despite a 30% lift in 6 months. (All number guesswork but the general gyst works).
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
