British motorists increasingly understand the impact of depreciation on the cost of motoring. That’s the conclusion of new research which has found that cars which traditionally hold their value are becoming more and more popular with drivers researching the total cost of ownership of a new car.
Car leasing and contract hire are costs largely determined by how well a car holds its value. Here, we look at why choosing a prestige car with low depreciation can help you to save money and we reveal the top 10 cars that Brits are researching online.
Under a car lease agreement, your payments are calculated based on the list price of the car and its expected residual value at the end of the lease. You effectively pay the car’s depreciation over the term (plus costs and a servicing package if applicable).
This means that choosing a car that is likely to hold its value can be a great choice if you’re thinking of buying using one of these contracts.
One of the main benefits is that you can often drive a more luxurious or higher specification car than you would be able to if you bought it using hire purchase. That is because these models often hold their value better meaning the depreciation – and therefore your payments – are lower.
German models dominate ‘low cost of motoring’ charts
New research from leading car cost experts CAP has revealed that increasing numbers of British drivers are considering German cars when they choose their next car.
CAP’s Total Cost of Motoring charts combine factors such as servicing costs, the cost of fuel and depreciation in order to help drivers choose the best cars to match their long term budget.
The company charts enquiries from drivers looking to research their motoring costs on their website. This helps them to understand the purchase intentions of up to 100,000 consumers a month who are in the market to change their car.
While the latest charts are topped by Britain’s best-selling car, the Ford Fiesta, German models are proving increasingly popular. BMW, Volkswagen and Audi take 6 out of the top 10 places in the new chart.
The latest data released by CAP reveals that the Ford Fiesta remains the car that most motorists are most interested in researching the long term running costs for. The Ford Focus also continues to ride high in the charts, slipping just one place to number 4 in consumers’ ownership cost investigations.
But, aside from one new entry by Nissan – at number 3 with the Diesel Qashqai – every other car in the top 10 is a BMW, Volkswagen or Audi.
CAP believes consumers now understand the impact of car depreciation better than ever and its impact on its cost with contract agreements. The increase in interest in German cars is thanks to consumers understanding that BMW, Volkswagen and Audi models have a reputation for holding their value.
CAP’s Retail & Consumer expert, Philip Nothard, explains: “Our independent ‘Total Cost of Motoring’ forecasts consistently reveal that depreciation is the biggest drain on your budget over the ownership period of any car.
“German brands enjoy a reputation among motorists for holding their value and that explains why so many of the people looking at CAP’s projected ownership costs are looking into the affordability of a BMW, Volkswagen or and Audi.”
Top 10 cars researched by CAP ‘Total Cost of Motoring’ users
- Ford Fiesta Petrol hatchback – [Fiesta]
- BMW 3 Series diesel saloon – [3 Series]
- Nissan Qashqai Diesel hatchback – [Qashqai]
- Ford Focus Petrol hatchback – [Focus]
- Volkswagen Golf Diesel hatchback – [Golf Diesel]
- Volkswagen Golf Petrol hatchback – [Golf Petrol]
- BMW 5 Series Diesel Saloon – [5 Series]
- BMW 3 Series Diesel Touring – [3 Series]
- Ford Fiesta Diesel hatchback – [Fiesta Diesel]
- Audi A3 Petrol Sportback – [Audi A3]