How to save thousands on Tesla UK PCP finance

[Peteski]

This is how my Blackhorse contract is worded (from Feb 18):-

"If you choose to return the goods at the end of the agreement and you exceed 40,833 miles you must pay us: if the excess miles are 4,999 or less 7.0 pence plus VAT per mile; if the excess is 5,000 miles or more 7.0 pence plus VAT per mile."

Previously it used to be advertised at 14.0 p + VAT after 5000 miles, but they changed it sometime between when I ordered the car and when it was delivered. I've no idea why they suddenly made it a flat rate, maybe some new legislation came into force?

The only possible catch I can see is if you are planning to put galactic mileage on the car, then you may get caught out by the fair wear and tear policy which appears to be quite strict. So you really need to look after the condition of the car if going way above the PCP contract mileage, although you could argue that the excess mileage charge should cover any extra wear and tear.

 

[chapweb]

Hi folks,

I’m just reviewing the summary terms (online) for the Barclays PCP and would like your opinions please. I’m new to PCP (and Tesla) having previously been a cash/loan buyer and need to decide between 10k, 12k and 15k contracts. I estimate I’ll do 12-15k/yr.

Originally I was told by Tesla Sales MK that the 8p/mile was unlimited, but the wording clearly limits this to 10k, then the charge goes to 14p/mile (see below).

However, I’ve asked for clarification and she’s now saying this means I can do 10k excess miles PER YEAR at 8p/mile. Which is not how I read it...

Annual mileage charge
You may drive the car 10,000 miles per year. If you drive more and the car is returned to us, an excess mileage charge will apply of £0.08 (plus VAT) per mile for the first 10,000 miles over the limit and £0.15 (plus VAT) for every mile after.

Appreciate your thoughts
(The trigger finger is getting sweaty)

 

[DJP31]

She’s wrong. If your limit is 40k (ie 10k a yr on a 4 yr plan) then if you do 50k the 10k is charged at the lower rate. Anything above that is charged at the higher rate.

If you chop in early it’s pro rata’d .

Also factor in the car is brilliant to drive and you will do more miles than you think.

Don’t forget a referral code too, PM me if you need one.

 

[chapweb]

Thanks, I thought that might be the case. The maths still works out slightly better if I go for a 10k/yr, do 15k/yr, pay excess then hand it back. However, I don’t know what I’ll do after 4 years and the 10k deal has a higher MGFV, so I think I’ll go with the 15k deal.

May I ask what you mean by “chop in early”?

 

[DJP31]

Thanks, I thought that might be the case. The maths still works out slightly better if I go for a 10k/yr, do 15k/yr, pay excess then hand it back. However, I don’t know what I’ll do after 4 years and the 10k deal has a higher MGFV, so I think I’ll go with the 15k deal.

May I ask what you mean by “chop in early”?

Sorry, I should have been clearer. There is a point during the finance where you can hand the car back earlier than the end date. It's when you have paid 50% of the total amount payable under the contract. Essentially it's the price of the car + interest minus the deposit and monthly payments made to date. It's normally quite late into the agreement (depends on size of deposit mainly) and if you are over the pro rata'd contractual mileage the excess charge is calculated on that mileage figure.

Technically the finance house can't demand repayment of the excess mileage charges at this point, and some people have walked away from the situation. In these cases it is common for the finance house to show the outstanding amount on the individuals credit file. It's not a default but it's not something I'd want to do.

Changing the subject somewhat, Elon tweeted they are withdrawing the 75D/100D very soon and will be replacing with a Standard/Long Range offering - much like the Model 3. I haven't a clue what this means in terms what will be available and at what price , but you might want to bear this in mind. One thing for sure, the Sales/Service Centre won't have a clue and you're likely to get more sense in places like this!

 

[chapweb]

Ah thanks, yes I worked that out to be around month 43 (of 48). Agree I wouldn’t want to mess the finance house around excessively either.

Very interesting to just read about discontinuing the 75D, not entirely sure what to make of it, other than guessing that if I wait around for a few months it might cost me ~~£10k more for a custom order?

I can’t imagine the 75Ds in inventory becoming less desirable / discounted because of this, anyone else think otherwise?

I have a deposit on a new inventory car and could potentially pick it up next week... if I confirm finance today...

Cheers.

 

[GeorgeSymonds]

I'd read it as 10k in total over the term although the length of term then does matter quite a bit

UK MS 75D new inventory is currently around mid 20s with around 3k off. If they offer you a inventory car check the year, they have some new inventory made in 2017 and a few changes have occured since then.

I don't think the 75D will be available as a custom order, if it is then it makes it a bit pointless although in fairness they did drop the panoramic roof only to say it was available as a custom order so maybe, but it if its a 10k premium on todays prices you may as well go for the 100D as they have some of those as New Inventory cars as low as 84k in the UK. Easiest way to see I find is use

Tesla UK new and used inventory car prices

apply the filter for new, add the discount column to see the savings and you can see whats what. I'd steer away from anything with more than 50 miles on them unless you're happy with a loan car or demonstrator.

 

[Peteski]

Thanks, I thought that might be the case. The maths still works out slightly better if I go for a 10k/yr, do 15k/yr, pay excess then hand it back. However, I don’t know what I’ll do after 4 years and the 10k deal has a higher MGFV, so I think I’ll go with the 15k deal.

May I ask what you mean by “chop in early”?

The 10k deal only has a higher MGFV because of the lower mileage and hence generates a lower monthly cost to you. You just have to factor in the cost of the excess mileage. In your case, say you do 15k miles per annum i.e. 60k miles over the 4 year term, then with the 10k per annum PCP, you would be charged 10k miles at 8p and 10k miles at 15p plus VAT i.e. a total excess of £2,300 + vat. So you have to work out if that is still cheaper than paying the higher monthly cost on the 15k PCP. In theory if the finance deals have been worked out properly it should work out slightly cheaper on the matched 15k PCP deal, but as we've seen this is not always the case!

It sounds like the Tesla sales guys are clueless about the finance deals, so I would speak directly to Barclays finance to clarify everything before signing up.

If you need a referral code just let me know or check my profile.

 

[Peteski]

I can’t imagine the 75Ds in inventory becoming less desirable / discounted because of this, anyone else think otherwise?

I think that depends a fair bit on what the revised line-up looks like and its pricing. If the base model ends up being 100 kWh then it could potentially make the cheaper 75D even more desirable for those who simply don't need the cost or weight of the larger battery. When I bought my X last year it was something like £18k to upgrade to the 100 kWh battery with zero benefit for my usage. Basically an £18k dead weight of around 150kg! So unless you really need the bigger battery I would snap up a 75D while you still can.

 

[chapweb]

UK MS 75D new inventory is currently around mid 20s with around 3k off.

Thanks for the advice, can I ask what you mean by this?

 

[chapweb]

I think that depends a fair bit on what the revised line-up looks like and its pricing.

Yes, I'm wondering whether to wait until Monday to see the revised line-up.

Agreed regarding carrying around kWh you don't need. I just don't want to buy it then they announce a higher range at a similar price (on Monday), or they have a clear-out of 75D stock. From what I've read it seems both are unlikely.

Thanks,
Andrew

 

[chapweb]

If they offer you a inventory car check the year, they have some new inventory made in 2017 and a few changes have occured since then.

My spec is as follows (2018 reg I believe with J in position 10 of VIN) it seems to be all the latest kit, unless you can advise otherwise?

Model S 75D
All-Wheel Drive Included
Solid Black Paint Included
Glass Roof Included
19" Sonic Carbon Slipstream Wheels
Black Textile Interior Included
Dark Ash Wood Décor Included
Dark Headliner Included
Six Months of Free Supercharging Included
Enhanced Autopilot
Premium Upgrades Package Included
Smart Air Suspension Included
Security Package Included

 

[DJP31]

Yes, I'm wondering whether to wait until Monday to see the revised line-up.

Agreed regarding carrying around kWh you don't need. I just don't want to buy it then they announce a higher range at a similar price (on Monday), or they have a clear-out of 75D stock. From what I've read it seems both are unlikely.

Thanks,
Andrew

I would be treading water for a few days as well. The reality with Tesla is that whenever you buy the chances are that shortly thereafter something will happen that makes your model 'out of date.' It's a little like computers used to be, wait another month and the processor/memory will be better. You'd end up never buying one!

Most of the time it's little things, but a refresh of the S in particular is due. They have also recently reduced the options in terms of interior trim, pan roof, carbon fibre etc. This could be running the stock down prior to an announcement. Then add in the Model 3 and CCS with a higher charging rate than the 75D can achieve - there's a whole lot going on at the mo.

I also can't believe the entry price will suddenly be jacked up to current 100D levels. The last time they drop a battery (the 60 went) the price of the 75 fell.

Never a dull moment!

 

[GeorgeSymonds]

Thanks for the advice, can I ask what you mean by this?

They have about 25 new inventory cars in stock in the UK and the average discount against a custom order is around 3k, some a bit higher, some a bit lower. The cars are still new and should be unregistered if showing with 50 miles.

 

[Peteski]

Yes, I'm wondering whether to wait until Monday to see the revised line-up.

Agreed regarding carrying around kWh you don't need. I just don't want to buy it then they announce a higher range at a similar price (on Monday), or they have a clear-out of 75D stock. From what I've read it seems both are unlikely.

Thanks,
Andrew

I think that's the sensible thing to do. They won't sell out of inventory 75D that quickly, so I would wait and make an informed decision either way. It's fairly clear that there will still be multiple range options, but not what those options will be or their pricing. There are a lot of potential permutations. They could even decide to build all cars with a 100 kWh pack, but lock the base version down to say 80 kWh in software. That would simplify manufacturing and add a later upgrade option for base model owners. It would also provide faster supercharging for the base model. The downside would be extra dead weight and probably a higher entry cost. They could of course introduce a bigger battery too, but probably less likely.

 

[chapweb]

Thanks all.

I think I’ll wait until Monday to finalise the finance agreement and balance then.

Most likely I’ll stick with it as it’ll (more than) meet my needs and I could take delivery next Friday

 

[DJP31]

Thanks all.

I think I’ll wait until Monday to finalise the finance agreement and balance then.

Most likely I’ll stick with it as it’ll (more than) meet my needs and I could take delivery next Friday

And there's nothing to say that the revised line up will be available straightaway anyway. For me this is one of the advantages of PCP. In 4 years time you can hand it back and upgrade to whatever advances in the technology have brought to market. Just don't rely on there being any equity in the car.

Whatever you buy will be "out of date", for me it was the bundling of the upgraded stereo and air suspension into the premium upgrades package. Since then the "iPad" processor has also been upgraded. However I don't regret buying when I did for a second, and am excited to see what the future brings.

Keep us posted!

 

[Peteski]

My spec is as follows (2018 reg I believe with J in position 10 of VIN) it seems to be all the latest kit, unless you can advise otherwise?

Model S 75D
All-Wheel Drive Included
Solid Black Paint Included
Glass Roof Included
19" Sonic Carbon Slipstream Wheels
Black Textile Interior Included
Dark Ash Wood Décor Included
Dark Headliner Included
Six Months of Free Supercharging Included
Enhanced Autopilot
Premium Upgrades Package Included
Smart Air Suspension Included
Security Package Included

Also note that they have since deleted the textile interior option, so you would effectively have to pay for the premium interior on a new custom order. I expect the spec you have listed above will be considerably cheaper than the revised base model, but you should be able to make that call next week when the new prices and specs are posted.

A further factor that may or may not make the inventory car cheaper is the PCP finance rate. Sometimes the rate is different on inventory cars vs custom order. When I bought mine last year custom order finance was cheaper, but when a friend of ours bought one a couple of months ago it was cheaper finance on inventory. Just something else to consider when comparing costs.

 

[GeorgeSymonds]

If you're looking at finance and handing the keys back, its also worth looking at the discounted 100Ds as the residual value is typically based on the list price and not the the purchase price. ie if the list is 120k discounted to 100k, and the residual is 50%, you're funding the drop from 100k to 60k or 40k. A 75D priced at 80k with no discount and a 50% residual would also drop 40k.

 

[chapweb]

A further factor that may or may not make the inventory car cheaper is the PCP finance rate. Sometimes the rate is different on inventory cars vs custom order

You're exactly right, thanks for the reminder. It's 5.4% (custom) vs 2.9% (inventory), I'd forgot this in the furvour over the last couple of days!