I regularly talk to groups of people about what I
consider to be my specialist subject, motor finance. Often an
audience member with an authoritative voice asks a dopey question
but manages to gain approval from the rest of the group.
One such daft question that I get
asked more than any other is: “How can leasing your car be any good
when you pay out all that money and have nothing to show at the
end?”
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Sigh.
It’s at this point that I take a
very deep breath and begin a polite answer. I find that’s easier
than taking a swipe at the daft questioner and ending up in a messy
court case.
I currently have a VW Passat CC GT
on a 2 year lease. The cost of the car would be more than £24,000
but the total lease cost over 2 years, based on 10,000 miles per
annum, will be £6,240 plus VAT.
When you consider that more than
£2,000 of that will be interest charges, they’re practically giving
the car away. But to some people all they see is that you simply
give the car back after 2 years with nothing to show for your
payments.
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By GlobalDataThe culture of ownership is still
deeply ingrained and consumers find it hard to understand the value
proposition being put forward in a lease.
Questions
asked
I hear that same question over and
over again. Far too many times, in fact, for me not to take it
seriously.
Are all these people, mainly small
business owners, as daft as brushes? Surely that cannot be. Maybe
there a serious underlying problem here in the way that the
industry is communicating about the product it has to offer.
Could it be that the industry is
letting all of these potential customers down by simply not getting
the message across?
Message
misunderstood
If customers are so confused and
miss the benefits of leasing, then lessors, dealers and brokers
like me are letting them down.
Ask most people the difference
between Freeview and Sky on their TVs and they will know.
Because the manufacturers and
sellers explain it to them in simple English, and sell the benefits
too. It seems to me that we are all missing a trick here as well as
a huge opportunity to sell more new cars on leases.
More information needs to be made
available so that consumers and small businesses can make informed
choices.
While potential customers continue
to get their information from work colleagues and mates down the
pub, the situation will not improve.
When looking for some proper
advice, customers tend to turn to dealers or bank managers, some of
whom are extremely knowledgeable, but many of whom struggle to know
the difference between a lease and a kettle.
It’s time that we found better ways of getting our message
across.
