Longer term means cheaper deals
07 January 2013
It’s at this time of the month that I take a look at the latest new car finance offers included in the Deals section that Auto Retail Bulletin publishes at the start of every month.
And with a new year has come a new trend. While there are still plenty of low and even 0% offers available, what’s emerged this month are some longer-term deals.
So, who’s doing these deals? It’s those brands that are more about price than prestige. You can get a Vauxhall Zafira for £169 a month, a Ssangyong Korando for £239 a month or even a Dacia Sandero for a remarkable £69 a month.
We’re talking about four and five-year deals here which, at first glance, seems like a very long time to run a car before you trade-in. However, in reality this shows two things.
First, that the longer-term financial outlook is looking more stable, with interest rates unlikely to change much in the medium term.
Second, as many customer-savvy auto retail groups have demonstrated in the past, that a longer term finance deal is one way of delivering an affordable new or used car.
And once buyers are signed-up to this it’s possible to approach them before the end of term with a fresh offer – say at the three-year point – to switch up.
Remember, it’s easier to sell to an existing customer than it is to a new one.