"New" (used) car options - EV Octopus Salary Sacrifice, Loan, HP, PCP?

[lucasaal]

Hi All,

It really is time for me to bite the bullet on buying a newer vehicle.

I've got a family with two children and we both currently drive around in 15-20 year old (volvo estate and a fiesta) cars (neither which have air con). I think we've done bangernomics for long enough and now need something that is suitable to growing toddlers.

I work in renewables (and so probably should be more conscious of what I drive), with this I have the option of using Octopus' salary sacrifice scheme (the only caveat is we're not able to have a Tesla, we can have any other manufacturer regardless of price point).

I've test drove the Polestar 2 (boot is a little bit small), Tesla Model 3 and Model Y, Audi Q4-etron. I also, alternatively really like the Land Rover Discovery. My preference is the Model Y.

I've been trying to work some maths out and could do with a sense check on what to do next. I've been trying to use the Model Y as a comparison in the below.

A £33k loan over 3 years would cost me £1028.48 monthly. Now, accounting for old, lowers my take-home by £529 or £19,044 for 3 years. However, this includes all insurance, tax, MOT, maintenance tyres, breakdown cover, etc.ke this. I've always driven around in a crap car because I've always wanted to 'own' it and not have a PCP or anything like a lease - I don't like the idea of throwing money down the drain to keep up with the Jones's.

I earn c. £90-100k p.a. and my partner £33-35k p.a. Currently our cars are our own and only cost is fuel, insurance, MOT, tax, breakdown cover, maintenance, tyres etc.

Octopus Salary Sacrifice

A £33k loan over 3 years would cost me £1028.48 monthly. Now accounting for old lower my take home by £529 or £19,044 for 3 years. However this includes all insurance, tax, MOT, maintenance tyres, breakdown cover etc.

Second Hand Model Y

I could buy a second-hand Model Y (2-3 years old) for around £30-33k via Autotrader, etc. I'd do this through a loan (and/or some cash). Question: Should I use some cash and take out a smaller loan? Lower interest?

Loan options:

• a) £28k loan (£5k cash) 36 months £872.65 p/m
• b) £33k loan 36 months £1,028.48 p/m
• c) £28k loan (£5k cash) 48 months £678.71 p/m
• d) £33k loan 36 months £799.91 p/m

Now accounting for the following with quite prudent assumptions: insurance (£800 p.a.), MOT (£60 p.a.), maintenance (£250 p.a.), tyres (£250 p.a.), breakdown cover (£50 p.a.) = £1,410 p.a.

This gives the following all-in cost over the term / per month:

• a) £40,645 / £1,129 p/m
• b) £41,255 / £1,146 p/m
• c) £43,218 / £900 p/m
• d) £44,036 / £917 p/m

Now, assuming a residual value after 3 and 4 years of £18k and £15k respectively this then reduces the costs to:

• a) £22,645 / £629 p/m
• b) £23,255 / £646 p/m
• c) £28,218 / £588 p/m
• d) £29,036 / £605 p/m

Am I being stupid here? Am I blind to something?

Should I be using the salary sacrifice scheme? Or am I letting the tax tail wag the proverbial dog? Should I look at PCP or HP or private lease?

Should I look at an ICE vehicle? I can get a Land Rover discovery for c. £20k?

 

[journeytoheaven]

@lucasaal The discovery would be a mad idea for you. Bad reliability and big expenses when it goes wrong.

 

[oannabi]

@lucasaal Could look at an mg5 if you want a big boot, the originals with about 200mile range (which is in reality fine even for international trips) are about 16k on auto trader. Or if you can get a good deal then revamped and longer range version is about 30k new

 

[lucasaal]

@oannabi Definitely need a bit boot. I’m probably being a bit of a badge snob for once as I really enjoyed driving the model Y.

Range isn’t an issue. I don’t do a lot of mileage anymore. And, let’s be honest you don’t drive for 200 miles without a break for a pee etc and popping it into an ultra-rapid charger

 

[bleubirdz]

@lucasaal I've been going over very similar thoughts to you (roughly similar financial/family situation -- we also liked the Model Y the most). I too wish the Polestar suited our needs better, as the depreciation on them makes them a particularly good pickup on the used market. We didn't have a salary sacrifice option available to us, but otherwise considered very similar options.

You can find PCPs on used Teslas (very lightly used in some cases,

 

[alyosha7]

@lucasaal Don't make the mistake of assuming your need for a pee/break coinsides with a charger being available at the location