6.9% finance rate jumped to 10.9%!!

[whitex]

The rate is controlled by VW Finance. The dealer has no power (or no desire) to change it.

Wow, in the UK Porsche makes you finance through VW, not allow any banks, credit unions, etc? Can you can at least pay cash, and borrow that cash from elsewhere? In the US, the dealers will offer corporate finance options, but are allowed to (and often do) up the interest on those to make extra profit on the load/lease. Consumers are however allowed find your own financing, they are not locked to the dealer financing.

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[Dabz]

Well, my cousin bought a Taycan 18 months ago through his business using porsche finance.. his deposit was £10k, then payments over 4 years, a balloon payment at the end... His accountant did his corporation tax return last year and claimed CT relief for the full OTR price of the car in pay years accounts... All went through fine...
My accountant independently provided the same advice to me, and will be doing the same...
Are you purchasing in the same way?

Sounds interesting and probably something I didn’t understand or realise!

I’m paying cash for mine out the business and then will reclaim the 25% corporation tax. It means we’ll have an asset worth near what we paid for it and then when I trade up in a few years we can claim tax relief on the extra between trade in and the new one. Good way of disposing of some cash right now

 

[jahall333]

Wow, in the UK Porsche makes you finance through VW, not allow any banks, credit unions, etc? Can you can at least pay cash, and borrow that cash from elsewhere? In the US, the dealers will offer corporate finance options, but are allowed to (and often do) up the interest on those to make extra profit on the load/lease. Consumers are however allowed find your own financing, they are not locked to the dealer financing.

Yes you can also use other financing options, banks etc. here in the UK too...

 

[whitex]

Yes you can also use other financing options, banks etc. here in the UK too...

Then perhaps doing some research can save you money. I've had situations where a dealer would offer a higher rate, but once I show them I have a lower options, they'd drop their interest rate too.

 

[Moonstone]

Of course not. You can fund the car however you like. However Credit Unions in the UK are very different. You won’t find any that’ll finance a Porsche. Also it’s now illegal for dealers to charge higher interest rates to increase their profit margins.

 

[whitex]

Of course not. You can fund the car however you like. However Credit Unions in the UK are very different. You won’t find any that’ll finance a Porsche. Also it’s now illegal for dealers to charge higher interest rates to increase their profit margins.

Here in the US you have many choices. Even insurance companies will finance your car, which is actually cleaver of them - when you call to quote a new car insurance, they ask if you're interested in their financing and if so give you a quote. They cannot beat manufacturer subsidized rates, but can be competitive with banks and credit unions. For manufacturer subsidized rates, you usually have to find those yourself and demand it from the dealer, or else many dealers will not tell you about them, pocket the subsidy instead.

 

[Moonstone]

Here in the US you have many choices. Even insurance companies will finance your car, which is actually cleaver of them - when you call to quote a new car insurance, they ask if you're interested in their financing and if so give you a quote. They cannot beat manufacturer subsidized rates, but can be competitive with banks and credit unions. For manufacturer subsidized rates, you usually have to find those yourself and demand it from the dealer, or else many dealers will not tell you about them, pocket the subsidy instead.

Those tactics are outlawed here. The dealer(acting as a finance broker) must pass on the deal from the finance company as it stands. There are many lawyers now inviting consumers to sue their dealer for miss-selling finance and claim compensation.

In terms of manufacturers subsidised rates, most dealers actively use this as a sales tool. For example BMWs finance rates have always been very competitive and if you take out their finance, on many models the manufacturer will provide a significant discount on the purchase price.

There are many third party options available but insurers do not offer car finance here. PCP is very popular in the UK but most mainstream banks and finance houses either don't offer it or only offer it up to a certain value. For cars that cost as much as a Taycan does, you need to go to a specialist and there aren't as many of those.

 

[ThePaddyWan]

Yikes! That is a huge rate hike.

It's manufacturer dependent. I've have experiences rates locked to the lower of current market vs. rates at the time of order. We were offered 0.9% (rates at time of order August 2021) for our most recent car when market rates were 4-5% (Nov 2022) or so in the US.

 

[DrMoo]

Hello all...
I placed my order for a RWD with really nice set of options last June.. signed the paperwork, interest rate of 6.9% and blah blah..
Had an email a couple of weeks ago, car gone up circa £2,000 and interest rate now 10.9%... over 4 years this all adds £14,000 to the total price!!
Sticking with it, but just gutted, feel ripped off.. sales advisor said "you can have your deposit back and walk away of you want.."
That's not what I've been waiting for for 40 years since I was a kid !
Ranting I realise.. everyone else in the same boat..?

I booked a Macan for the Mrs in Dec and the sales manager said well you’re locked in at 10.9% so if the rate increases, you’re safe, but if it drops you can take advantage of it.

PRG Reading

I have looked around a bit and those with lower rates have lower residuals, so the monthly cost is higher.

Depends on your plans for the cad longer term.

 

[Wilson]

I booked a Macan for the Mrs in Dec and the sales manager said well you’re locked in at 10.9% so if the rate increases, you’re safe, but if it drops you can take advantage of it.

PRG Reading

I have looked around a bit and those with lower rates have lower residuals, so the monthly cost is higher.

Depends on your plans for the cad longer term.

This is exactly what I was told when I ordered my Taycan on 4th March. Locked at 10.9% and if the offered rate drops prior to delivery then I will realise the lower rate.

I have also made sure to get a good few quotes on various options as I have read on here that multiple quotes can unlock lower rates when finally confirming the deal.

 

[Raphie]

i bought a 1 year old MY21 last Dec with 9k miles on the clock for 129k€, configured on the configurator it was 169k. It also had a ppf front of 3k€. Slapped a set of 21” Satin Black RS Spyders on for 7k€, this config after price raise, now nearly tips 185k€ new. In Dec dealer offered 5.4% via independent finance, but I declined, as I didn’t need it. factory warranty ran out last month, but I’ve got 1Y warranty from the dealer up to Dec. In Nov it will be examined for Porsche approved extended warranty, if anything pops up it will be for the dealer. Once passed, I’ll take another 3years of Porsche approved for 4k€ or so.

So it seems for the next 4Y’s I‘m sort of having my cake and eating it.
doing this now, new, without savings, seems crazy money. And I would probably never do it.
I’ve always been brought up with “it’s about what you can afford, not what you can get away with”
But if you can‘t pay cash, with these rates you‘ll bleed.

 

[whitex]

I booked a Macan for the Mrs in Dec and the sales manager said well you’re locked in at 10.9% so if the rate increases, you’re safe, but if it drops you can take advantage of it.

PRG Reading

I have looked around a bit and those with lower rates have lower residuals, so the monthly cost is higher.

Depends on your plans for the cad longer term.

Anything in writing for this? I'm thinking the sales manager thinks the rates have peaked, or close enough that he could eat the difference and still make money. As soon as if becomes a loss for the dealership, unless there is an enforceable contract, he's going to shrug and say "it is what it is".

 

[Crazymind]

Porsche didn’t give me the option to pay cash… they want you to take finance. Or stay in the queue for future delivery. I just want the CT badly and soon so I took the finance I’ll pay the first month and set a down payment to 50 quid per month… I didn’t see the contract yet but possibly after the first month I’ll pay the remaining balance and close finance if possible.

 

[Wilson]

i bought a 1 year old MY21 last Dec with 9k miles on the clock for 129k€, configured on the configurator it was 169k. It also had a ppf front of 3k€. Slapped a set of 21” Satin Black RS Spyders on for 7k€, this config after price raise, now nearly tips 185k€ new. In Dec dealer offered 5.4% via independent finance, but I declined, as I didn’t need it. factory warranty ran out last month, but I’ve got 1Y warranty from the dealer up to Dec. In Nov it will be examined for Porsche approved extended warranty, if anything pops up it will be for the dealer. Once passed, I’ll take another 3years of Porsche approved for 4k€ or so.

So it seems for the next 4Y’s I‘m sort of having my cake and eating it.
doing this now, new, without savings, seems crazy money. And I would probably never do it.
I’ve always been brought up with “it’s about what you can afford, not what you can get away with”
But if you can‘t pay cash, with these rates you‘ll bleed.

Whilst I appreciate your viewpoint here it is only one way of looking at the picture and it’s a very personal thing. I have savings sat in the bank but I have always put my cash in to property or saving for a rainy day and used my disposable income for cars.

While this might look expensive when considering the car in isolation if I plough the value of my Taycan order onto my deposit for the house we plan to buy next year, I save significantly more on the mortgage than the interest on the car, so the overall picture needs to be considered.

A further consideration for many is that to qualify for tax incentives etc the car needs to be new, I am buying personally so this doesn't apply to me but I do have a desire to own a car that is always under warranty, again a personal choice that comes at a cost but I want to have that comfort blanket and a specified car exactly to my liking.

 

[Raphie]

Whilst I appreciate your viewpoint here it is only one way of looking at the picture and it’s a very personal thing. I have savings sat in the bank but I have always put my cash in to property or saving for a rainy day and used my disposable income for cars.

While this might look expensive when considering the car in isolation if I plough the value of my Taycan order onto my deposit for the house we plan to buy next year, I save significantly more on the mortgage than the interest on the car, so the overall picture needs to be considered.

A further consideration for many is that to qualify for tax incentives etc the car needs to be new, I am buying personally so this doesn't apply to me but I do have a desire to own a car that is always under warranty, again a personal choice that comes at a cost but I want to have that comfort blanket and a specified car exactly to my liking.

Agreed, it’s very personal and priority thing. In my case I paid of my mortgage last year, so had no savings to be had elsewhere. In NL there are no tax incentives on EV’s above 45k€ So didn’t miss out on anything there either. But yes every situation is different, that’s why multiple viewpoints are valuable.

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