- At last, an alternative to buying a car
- This deal lets you take a usage holiday
- Brand-new car, delivered to your door
LONDON, England – Some form of credit is used by most people to ”own” a car yet research* Europcar Mobility UK showed drivers who had taken a loan, only 53% admitted to fully understanding the terms and conditions of the deal.
There was also, the researchers reported, confusion about what is – or isn’t – included in a car finance deal. (Perhaps ask the same question in South Africa – and ask about a mobility deal such as set out in this feature.)
In particular, according to Europcar Mobility Group UK, there’s misperception about what’s included in a personal contract purchase plan (PCP). For instance, almost 25% thought breakdown cover was included with a PCP.
In fact such cover was rarely included in a PCP even though the lack of one could prove expensive yet rarely does the owner have budget for such a happening.
NEW CAR, NO COMMITMENT
Tackling the confusion in the UK and giving people a flexible way to drive a new car without the hassle of finance is Long Term Flex. South Africans might like to investigate similar arrangements with their vehicle supplier.
Long Term Flex will supply a new car without the commitment of a three- to five-year finance deal or cash purchase. ‘Flex’ibility is key. Customers can simply choose a vehicle from a wide range, choose what is essentially a rental period for a minimum of six months months, and commit to a certain maximum number of kilometres to be covered over the period – no big upfront deposit.
Gary Smith, MD of Europcar Mobility Group UK. told The Corner in a media release: “Our latest research shows access to a car is vital – nearly 60% of those we surveyed used their car every day.
”However, the typical three- to five-year finance deal was a pressure some might prefer not to have.
“Long Term Flex gives the freedom to take a ‘holiday period’ from car ownership – perhaps if circumstances change – or if the driver is, actually, going on holiday. There’s no penalty for taking a break, unlike the hefty early-termination charges typical of conventional vehicle finance.”
The long-term financial commitment of a PCP was also misunderstood by research respondents. About 45% correctly identified that at the end of a PCP a final payment must be made to take ownership. And 23% admitted to not being unsure about taking ownership.
NO BALLOON PAYMENT
Unlike normal leases, Long Term Flex offers the flexibility to opt out of the contract after only six months without any early-exit penalty. Or they can drive for up to 18 months, after which it’s easy to repeat the process and collect a completely new car.
Gaby Roslin, who worked with Europcar on its campaign, said, “With a lease you have to make a monthly payment, a balloon payment at the end of the (say) three years, and pay for maintenance and roadside assistance.
”Long Term Flex includes maintenance, servicing and roadside assistance all included.”
‘VEHICLE CAN BE ESSENTIAL’
A variety of vehicles is available (in the UK): Fiat 500, hybrid Hyundai Ioniq or Mercedes A Class – with a choice of 1600 or 3200km per month. The chosen vehicle will be delivered to the customer’s door
Gary Smith added: “Having access to a vehicle can be essential. We provide people with a flexible option that cuts out the uncertainty of ownership – servicing and maintenance – while supplying a brand-new car.”