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Original poster

How do lots of people afford the brand new luxury cars ?

361 replies

Stroganoffo · 02/02/2023 15:24

Keep seeing 22 plate Mercedes, Audi , BMW and tesla, when I was little these were quite rare as only the wealthy had them. Now it seems everyone has one considering the average wage isn't that high and the cost of one is 50k. I have a good wage and still don't want to fork out lots. How are people affording them. Is it all on credit ? Aren't people worried with everything else going up and the cost of living crisis ?.

OP posts:
Activelyannoyed · 02/02/2023 15:26

You do know to get credit you need to habe the income right? It’s not like you can be low income with lots of outgoings and they just throw you fifty grand?

gogohmm · 02/02/2023 15:27

Pcp or company cars.

Wheredideveryonego · 02/02/2023 15:27

Debt it most cases I imagine

CoffeeRightNow · 02/02/2023 15:28

Leasing, most likely.

drpet49 · 02/02/2023 15:29

Leasing

RJnomore1 · 02/02/2023 15:30

It’s all on PCP or lease deals.

They don’t ever own them.

(I don’t mean no one owns one btw I mean if you lease/PCP you never do)

lgiveitarestbt · 02/02/2023 15:30

Lease

Activelyannoyed · 02/02/2023 15:30

These answers are silly.

you need to have the income to get the credit. You need to be able to pay it back every month, if it’s pcp or finance. So doesn’t explain it.

and few jobs get 50 grand cars.

Activelyannoyed · 02/02/2023 15:33

Op, being serious for a moment. I think you have folks answering who don’t have one, will never have one and don’t know.

to have one you need to be able to afford it. Be it on monthly repayments via finance or pcp. Or you need to have a job at a sufficient level which gives this kind of car, or you need to have the money to buy it.

glasgow1983 · 02/02/2023 15:34

Remember that not all of these models are luxury cars.

The BMW 320d / Audi 35, Mercedes 180d are your base spec cars which actually come in cheaper on a monthly basis than a "normal" car, because the residual value at the end of lease or PCP agreement will be higher.

Nothing unusual about leasing or using debt to fund a depreciating asset.

I prefer to buy and sell years down the line, but if you have a two earner household then a £400 monthly payment which minimises servicing and repair costs is a perfectly reasonable decision to make.

Wnikat · 02/02/2023 15:35

Leased or company cars. Particularly Teslas as they avoid benefit-in-kind tax.

QuertyGirl · 02/02/2023 15:38

There's loads of those bariatric bumper car things round here at the moment. They look expensive!

I mean seriously- this kind've thing in urban environments is batshit;

https://www.toyota.co.uk/electric/bz?gclid=EAIaIQobChMIvKyujJX3AIVwsvtCh0MLQ4eEAAYAiAAEgKe4vDD_BwE&gclsrc=aw.ds

Oopswediditagain2023 · 02/02/2023 15:38

I agree - I have no idea where the money comes from. Both myself and DP have good incomes, but there's no way we could spend £1,000+ on cars per month, especially if we wouldn't even own them at the end of the day.
A few people I know get a car allowance from work, but that's £350ish a month maximum so they then stump up the further £200+ a month themselves for a car.
I only know one friend who is given a company car (a nice one, so a Mercedes saloon car etc) as part of his work package.

I have two friends who pay more than their rent each month for their cars (range rovers). It seems ludicrous to me - they'd be better driving a cheaper car and saving the money for a deposit on a house etc, but maybe I'm just old fashioned.

RedToothBrush · 02/02/2023 15:38

They can't afford them.

That's one of the reasons there are so many middle income families really struggling right now because they are tied into leases that really are beyond their means even though they've been given credit.

Being given credit doesn't mean you can afford something. It means a credit company sees you as a prime opportunity to make money. The two things are separate issues and assuming that if you are given credit you can afford something is a fallacy that screws up a lot of people.

Baconand · 02/02/2023 15:40

We lease. We get some absolute bargains.
Only a financial idiot would buy a depreciating asset like a new car outright.

Oopswediditagain2023 · 02/02/2023 15:41

RedToothBrush · 02/02/2023 15:38

They can't afford them.

That's one of the reasons there are so many middle income families really struggling right now because they are tied into leases that really are beyond their means even though they've been given credit.

Being given credit doesn't mean you can afford something. It means a credit company sees you as a prime opportunity to make money. The two things are separate issues and assuming that if you are given credit you can afford something is a fallacy that screws up a lot of people.

Cross posted - also this ^^
We looked at leasing a car just at the end of the last lockdown and thank god we didn't. We were offered at the time "great deals" but even though our incomes have risen slightly, our outgoings have significantly risen and we'd struggle to make even a £400 repayment each month on top of everything else.

Hobbesmanc · 02/02/2023 15:43

Activelyannoyed · 02/02/2023 15:30

These answers are silly.

you need to have the income to get the credit. You need to be able to pay it back every month, if it’s pcp or finance. So doesn’t explain it.

and few jobs get 50 grand cars.

Actually it's not silly. For example someone like Cazoo will hand over a Range Rover or Jag in a 2000k deposit and affordable monthly payments even for average earners. Say £400 a month. But you don't own the car and after the three years contract ends you basically hand it back and start again. Just watch your mileage

FenghuangHoyan · 02/02/2023 15:43

I knew one guy who bought a Ferrari. It was on a 25 year loan. I figured he was insane, but the car and the "status" meant more to him than the ludicrous amount he was having to pay back. The car was probably in a hedge within a few weeks.

pebbles3004 · 02/02/2023 15:44

Baconand · 02/02/2023 15:40

We lease. We get some absolute bargains.
Only a financial idiot would buy a depreciating asset like a new car outright.

The rest of us aren't buying new cars though (well some people may be) but I reckon most of us who aren't taking out debt to own a fancy car, are buying second hand cars. That way we actually own something. After a lease, you walk away empty handed, thousands of pounds down.

Anamechange2 · 02/02/2023 15:45

My DH has a new Tesla , it's a company car.
He is very senior in his company, I don't think it's that unusual for people in his position.

Campervangirl · 02/02/2023 15:45

PCP, I've had some really great cars on PCP, expensive, high performance cars that I wouldn't be able to normally afford.
Put a deposit down, monthly payments, you can upgrade when a new car comes out and keep upgrading or pay the balance off and the cars yours

Crabwoman · 02/02/2023 15:46

They lease them.

Or they are company cars and they get a decent car allowance. A few neighbours drive Tesla due to some tax thing for electric cars.

Or they and buy or lease a car through the business.

Or they just prioritise cars. I have a friend who is quite content living in a tiny flat as he'd rather spend his money on nice cars.

PurBal · 02/02/2023 15:47

Cash but mostly likely credit. apple.news/Ap7GpnwxeRjyZ_d-gKyBYXA

pebbles3004 · 02/02/2023 15:47

I have always thought leasing a car was bonkers. We earn well (over £100k for the household) and would never even think of spending even £400 a month on a car. We have so much else we would rather do with £400! We both have good second hand cars (VW & Seat) and will most likely own them for years to come, until they are costing us money multiple times a year in repairs and upkeep. I don't understand pouring money into something that sits in the driveway or work car park most of the time.

Campervangirl · 02/02/2023 15:49

Forgot to add, we returned our last car on PCP to the dealer and they gave us 6k back because of covid the price of used cars had shot through the roof, we used that money to buy another 2nd hand car as a runaround because we have a camper and it was all getting too expensive