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

[Stroganoffo]

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 ?.

I looked at leasing but we are hard on cars (e.g. use them off road) so it was all a bit too risky.

Having a car on PCP is just another debt to worry about, much more straightforward and financially sensible to own your car, maintain it well and drive it for as long a possible.

These threads always have the embittered poster or two muttering darkly about living on the never never

I guess it's all relative, for one person £400 pm might be affordable and they can cope with increases in costs but for others this would mean a lot of difficulty.

Whereas I can’t imagine the aggro of owning a car. I have no interest in car ownership, I just want something reliable to drive. Leasing one makes far more sense for me. If anything goes wrong, someone comes to fetch it, takes it to be fixed and brings it back, and the cost is covered by my monthly payments. I hand it back after 3 years, before it needs to be MOT’d. We’re all different and have different priorities.

@SilverGlitterBaubles 100% agree. I haven't always been able to afford it, I can now, so I do. If my circumstances changed, so would my car.

There are some very old fashioned attitudes to cars here . I owned my last car for 5 years - paid the money up front , paid for services, tyres etc over the 5 years. I have been lucky in selling it for a good amount due to the shortage of second hand cars just now. I now have a car on subscription which covers everything except insurance and it will cost me approximately the same as my last car when everything is taken into consideration. At the end of my 3 years I don't "own " my car as I will get a new one. I am better off paying my sub of 550 per month than shelling out 55,000 to "own" that. My 55,000 is sitting earning interest instead. It doesn't make sense to buy expensive cars upfront.

For me, owning a car is just another thing to maintain that I have to worry about!

What happens to the cars when they're given back?

This seems hideously wasteful

They don’t just scrap them 😂. They’re usually sold as second hand cars.

In the case of Volvo they are recycled by making greater use of recycled material, and remanufacturing and reusing parts.`They have something called the Circular Economy and they are not the only car manufacturers to do so.

By and large the people I know with very average incomes or less lease or PCP cars and those with higher incomes buy cars for cash and wouldn’t dream of changing them every 2 years. 🤷‍♀️

On finance or company car. I doubt very many are owned outright!

So u can prob get a Tesla with 1 month upfront as deposit then monthly payment about £600-£700 a month. It's still a huge monthly payment.

And what’s the problem with that? There is so much snobbery aimed at people who lease cars. It suits us. We have no interest in car ownership whatsoever, it’s too much hassle.

Yes exactly.

The way I see it - if you’re leasing or taking a loan for a car then there is an extra layer of middle men making money from you. The Finance department at these car companies are there to make money, they aren’t loaning you a car and making a loss on you. I did once spend a day making an excel sheet of all the different financing options available on a number or cars and adding up the total cost over day 5,10 years. I tried every option I could and paying cash was always the best option.

Only exception is sometimes tax efficient cars like Teslas seem to be currently.

Leasing. My daughter (23) drives a big Merc but when the lease is up, she's chipping it in for one that isn't so fuel guzzling. BIL has a new Tesla but it's a company car. He's retiring soon and says he can't afford to buy the same car.

What works for one doesn’t another
neither is wrong.

Oh and calling petrol cars polluting pieces of shit is naive at best.
look at how your electric car is mined.

the greenest car you can drive is the one you already own. The constant consumption of new is a much much bigger issue. New cars are not designed for longevity, they are becoming consumable subscription service. And that is an issue for tomorrow

Nothing wrong with it at all but I don’t look at people with brand new cars and wonder how on earth they afford it, that’s what I mean. A brand new car meaning you are very wealthy is something a lot of us still assume because it was that way when we were younger.

I know someone who earns about 35k a year and has a Range Rover… I think as far as he sees it, it’s not a long term commitment - he’s only committed for the short period and at this point in his life, that’s what he wants to spend his money on more than anything else. So there are no holidays, he rents a small 1 bed but he has the car he wants. It may be unaffordable when the leasing period ends, but he doesn’t care and he’ll lease what he can afford then. For some people they love that they can think of cars as a shorter term commitment now and their needs / wants may change every few years anyway. It’s not for me but it’s how it works now for a lot of people.

Does it matter whether a car is bought or leased? Neither is a mark of superiority. People who lease still have to demonstrate they can afford the repayments, so it’s not like they’re they’re broke yet trying to show off.

for what it’s worth we bought ours outright because that suited us. People can afford it because despite the cost of living crisis, there are people still living comfortably.

Yes. When we trade in our current one they’re actually giving us £2k back because the trade in value exceeds the maximum allowable deposit on the new one. We’ll pay it back into our pcp account a few months in.

People prefer to lease than brake down coughing up service charges. Just as the car is about to cause problems, they get a new one. I think those that pay 50k in full for a new car is bonkers and that's a basic mini suv price. Try the bigger ones it will easily go over 100k, so imagine paying that in one chunk just because you don't want to pay in instalments and want to own it outright lol.

They get picked up by a national auction house and sold on to end up on second hand car dealers forecourt.

Ethically sourced lithium and cobalt?

I have a bicycle, I'm not interested in driving a car with blood on the steering wheel. I have standards too.

They usually go on the dealerships’ forecourt and that’s where people who like owning second hand cars buy them. The unused warranty goes with them.