Is a new Focus worth a whole year's salary?

[StephenFord]

On another thread it just struck me that a brand new focus is now easily the cost of a full years 'average' salary. (I personally have been out of the 'new' car market for over 25 years having seen the effect of depreciation, and enjoying the thrill of buying 'above my means' by getting used).

I was just curious when people go into that shiny showroom, and get palpitations at ticking the options box, have they ever considered a used car, or for them is it a no brainer and of course they just get a new car?

 

[Lenny]

26 minutes ago, StephenFord said:

On another thread it just struck me that a brand new focus is now easily the cost of a full years 'average' salary. (I personally have been out of the 'new' car market for over 25 years having seen the effect of depreciation, and enjoying the thrill of buying 'above my means' by getting used).

I was just curious when people go into that shiny showroom, and get palpitations at ticking the options box, have they ever considered a used car, or for them is it a no brainer and of course they just get a new car?

 

Is the average salary really €22,000 after tax?

[eddie eastwood]

What is the average salary in the UK per year?

It's awkward, isn't it? The median annual income in the UK, according to the most recent Annual Survey of Hours and Earnings, is £28,677 for full-time employees.12 May 2018

 

What is the UK average salary 2019?

The average advertised salary for an employee in the UK is £35,058 a year, as at February 2019, according to research by job search engine Adzuna.8 Apr 2019

 

[StephenFord]

The average annual salary can be debated, but on 'average' may blown easily on getting a new Focus. Anyway, totally detracts from the question, is buying a new Focus worth a years salary?

[YOG]

Maybe the question should be, "Is it worth is buying a new Focus?" 😉

Some comparisons of new car prices when sold, with inflation adjusted for 2016:

2016 - Prices sourced from Car, Autocar, Autocar & Motor, Motor, What Car?

Year/Car/Price new (2016 adjusted)

 1950: Ford Anglia – £310 (£9,888)

1951: Austin A30 – £507 (£15,685)

1952: Ford Consul – £717 (£20,332)

1953: Ford Popular – £391 (£10,154)

1954: Austin A50 – £649 – £720 (£16,347 – £18,135)

1955: Humber Hawk – £985 (£24,371)

1956: Austin A35 – £541 – £638 (£12,810 – £15,106)

1957: Berkeley Sport – £574 (£12,956)

1958: Austin A40 – £676 – £698 (£14,713 – £15,192

1959: Mini – £497 – £537 (£10,502 – £11,348)

1960: Skoda Felicia – £744 (£15,628)

1961: Hillman Super Minx – £854 (£17,761)

1962: Ford Classic – £723 – £779 (£14,542 – £15,668)

1963: Hillman Imp – £508 – £532 (£9,796 – £10,259)

1964: Lotus Cortina – £1,100 (£20,797)

1965: Saab 96 – £729 (£13,343)

1966: Porsche 911 – £3,438 (£60,041)

1967: Rover P6 – £1,358 (£22,826)

1968: Renault 4 – £599 – £629 (£9,823 – £10,315)

1969: Ford Capri – £890 (£13,939)

1970: Rolls-Royce Silver Shadow – £9,272 (£137,780)

1971: Jaguar E-Type V12 – £3,139.38 (£43,866)

1972: Ford Cortina – £963 (£12,294)

1973: MGB – £1,393.06 (£16,604.87)

1974: Renault 16TX – £1,894.75 (£20,682)

1975: BMW 2002 Tii – £3,659 (£34,431)

1976: Chrysler Alpine GL – £2,164.49 (£16,399)

1977: Renault 4 – £2,595.29 (£16,879)

1978: Ford Capri 2.0S – £4,035 (£22,661)

1979: Fiat Strada – £3,044 – £3,742 (£15,785 – £19,405)

1980: Triumph TR7 – £6,361 (£28,088)

1981: Mazda 323 – £3,399 – £4,499 (£13,172 – £17,435)

1982: Fiat Panda – £2,995 (£10,372)

1983: Ford Escort RS1600i – £6,700 (£21,366)

1984: Saab 900i – £8,510 (£25,944)

1985: Citroen 2CV Special – £2,774 (£8,054)

1986: SEAT Ibiza – £4,095 – £5,771 (£11,206 – £15,793)

1987: Citroen BX GTi – £10,205 (£27,009)

1988: Rover 800 Vitesse – £19,944 (£50,656)

1989: Lada Riva – £3,495 (£8,462)

1990: Daihatsu Charade GTti – £8,299 (£18,640)

1991: Renault 19 16v – £12,725 (£26,102)

1992: Jaguar XJS 4.0 Convertible – £39,900 (£77,284)

1993: Citroen ZX Volcane TD – £12,630 – £12,995 (£23,590 – £24,272)

1994: Saab 900 SE Turbo Coupe – £21,895 (£40,252)

1995: Hyundai Sonata 2.0 CD – £15,499 (£27,826)

1996: Land Rover 90 County V8 – £14,468 (£25,096)

1997: Porsche Boxster – £33,950 (£57,510)

1998: Bristol Blenheim – £119,000 (£195,520)

1999: Lexus IS200 – £20,500 (£32,575)

[StephenFord]

LOL, OK, I give up! 🤣 I simply wanted to know why people would drop a years salary on a new Focus, when spending maybe £10 grand on used would get you a car worth maybe £60,000, or £70,000 when new! I appreciate y'all don't want to play - that's fine... 😁

[DaveT70]

You wouldn't "drop" a years salary on a new Focus because:

1: You never pay for a new car in cash, unless you're daft

2: Finance gives you marketing support (deposit allowances etc) so you end up with about 30-40% off (if you know what you're doing)

3: At the end of the agreement you can have another new one for less per month sometimes

4: The £10,000 used car could've been on it's roof

I never look at the list price or even final purchase price when I buy a new car, just the monthly payment

 

[StephenFord]

Gosh, a sensible answer - how did that get in here! LOL I get that, you just have a 'monthly rental' figure in mind. I'm of a generation where you didn't get into debt' but that's how it works now I guess. My monthly outlay for my car is zero, as I actually own it, but it is old , like me, so I don't mind a bit. The last 'new' car I had was my 1990 Escort RS Turbo, and even then, I saved furiously, and just got a top up loan for a year, so still owned it soon after.

Makes you wonder why manufacturers bother quoting a list price now rather than just a 'monthly outlay' cost.

Yes, the £10,000 car could have been on it's roof, but only if you did no research at all on it's history... In the past I have owned £50,000 cars (when new), but depreciation is a wonderful attribute for the used car buyer LOL

 

 

[Guy Heaton]

I wouldn't make that equation either, with yearly salary and new car price, as under PCP I will never pay that price anyway.

What's the monthly pcp cost?  Can I afford it and does it make financial sense in my circumstances (warranty, courtesy car, no repair bills etc.)?

I've been stung once too often with colossal bills and car off the road for days.

As to options - these DO make quite a difference to that monthly so yes, they are considered carefully.

 

[Lenny]

1 hour ago, StephenFord said:

The average annual salary can be debated, but on 'average' may blown easily on getting a new Focus. Anyway, totally detracts from the question, is buying a new Focus worth a years salary?

In my personal opinion based on my personal salary no it's not worth €68,500 

[StephenFord]

1 minute ago, Lenny said:

In my personal opinion based on my personal salary no it's not worth €68,500 

LOL, no need to show off!

[Eric Bloodaxe]

We've been through this one before in many forms. Whichever way you "buy" - outright purchase, HP, PCP, lease - it's just a matter of funding the depreciation over the typical 3 or 4 year period. I don't think there's one "right" answer - depends on your circumstances and what's on offer at the time. As long as you look at it very carefully and think ahead to how you might fund your next vehicle, you should be ok!

I've had the experience a few times of getting a big discount (or "deposit contribution") for taking finance and then paying it off almost immediately so I don't pay interest anyway. Of course, the manufacturers finance arms  hope that most people won't or can't do this and the idea is to get you "hooked" and paying £300 a month at 4.9% apr or whatever for as long as possible.  I've even been advised to do this by salespeople - they don't care as they've earned their commission by getting you to take finance, what happens after that, they don't care!😀

 

[TimST2]

Or just buy 2 years old. It's already depreciated by a third and you're still essentially getting a new car with a year's manufacturers warranty.

I've done that with my last 2 Fiestas and both had less than 10k on the clock.

[Ennvoqation]

2 hours ago, DaveT70 said:

You wouldn't "drop" a years salary on a new Focus because:

1: You never pay for a new car in cash, unless you're daft

2: Finance gives you marketing support (deposit allowances etc) so you end up with about 30-40% off (if you know what you're doing)

3: At the end of the agreement you can have another new one for less per month sometimes

4: The £10,000 used car could've been on it's roof

I never look at the list price or even final purchase price when I buy a new car, just the monthly payment

 

Actually buying straight cash does give you some bargaining power with some dealers. Especially in the current climate, know someone that managed to get nearly 10k off a new Jag I-Pace because they paid cash. That's excluding any extras and government grants.

I also prefer to own the vehicle out-right, with no headaches, such as worrying about over-mileage and whether I own it under HP. It allows me to modify the vehicle if need be or add to a vehicle fleet. Depending on circumstances it's more 'tax efficient' to buy outright than to lease it although the Tax Man tries to pretend otherwise(at least according to my accountant).

Personally I just buy second hand between two-three years old, as modern vehicles depreciate too fast and I tend to drive them into the ground with the mileage I do. I also keep my vehicles 5-10 years if they're serviceable (Got 13 years out of my last Focus). The only car I'll buy new is a Caterham but that's a completely different story.

Whether it's worth it depends on if the vehicle has features that no used car has, or if it's something you really want. It also depends on if you have the spare cash to pay for the vehicle and attendant bills. If I have the cash I probably buy a new electric, mostly because they're evolving so fast it makes it more economically viable to do so to take advantage of the savings you can get. 

Of course the dealers will want you to get HP, it's the only way they're going to get a decent profit even with the wiggle room they get from the manufacturers.

[TimST2]

The only car I'll buy new is a Caterham but that's a completely different story.

There are certain cars that have very good residuals so it makes sense if spec is important.

Of course the dealers will want you to get HP, it's the only way they're going to get a decent profit even with the wiggle room they get from the manufacturers.

Surely with any finance it works out more because you're paying for depreciation and interest?


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[Ennvoqation]

39 minutes ago, TimST2 said:

Surely with any finance it works out more because you're paying for depreciation and interest?
 

 

Yes and no, if you're doing it through a business then depending on your tax structure in can be beneficial as a lease vehicle. It's a complicated mess when you involve taxes, depreciation and loss offsets.

[isetta]

I have never bought new. Previous fiesta was 5 months old with 1600 miles on. Owned 9 years and did 145k miles in it. Current fiesta was10 months old with 9500 miles on it.  Will probably keep for as long as previous one. Price compared to new very good. The downside is that it’s harder to get colour/ spec you want 2nd hand. Both of these were 150 miles from where I live.

[TimST2]

1 hour ago, Ennvoqation said:

 

Yes and no, if you're doing it through a business then depending on your tax structure in can be beneficial as a lease vehicle. It's a complicated mess when you involve taxes, depreciation and loss offsets.

Right - not my area of expertise at all. I guess I was thinking in terms of private purchases.

[TimST2]

8 minutes ago, isetta said:

I have never bought new. Previous fiesta was 5 months old with 1600 miles on. Owned 9 years and did 145k miles in it. Current fiesta was10 months old with 9500 miles on it.  Will probably keep for as long as previous one. Price compared to new very good. The downside is that it’s harder to get colour/ spec you want 2nd hand. Both of these were 150 miles from where I live.

Wow - you had to look a long way! Were you after a particularly unusual spec/colour combo?

My Fiestas have both been a common spec available at my local Ford dealer - a red Fiesta Zetec and a Black Fiesta ST-2. The spec was important to me each time but not so much the colour. I had a list of colours I didn't want of course but that still left a good amount of choice.

In a complete coincidence (given what @Ennvoqation posted above), I have just ordered a brand new Caterham (!) - but depreciation is very low (you're looking 8-10 years old to get the % saving you'd get on a Ford at 2 years old) and there's no such thing as a standard Seven.

[StephenFord]

1 minute ago, TimST2 said:

...In a complete coincidence (given what @Ennvoqation posted above), I have just ordered a brand new Caterham (!) - but depreciation is very low...

OK, I'm officially jealous now! My neighbour took me out in his a few years back before he sold it, one of the most exciting cars I've ever been in! Drive it in good health...

[TimST2]

1 minute ago, StephenFord said:

OK, I'm officially jealous now! My neighbour took me out in his a few years back before he sold it, one of the most exciting cars I've ever been in! Drive it in good health...

It's a bit of a dream car for me (and Mrs TimST2) - another reason we're buying new.

It'll be a weekend and track car that replaces a Lotus Elise that we owned for 14 years...

[Ennvoqation]

6 minutes ago, TimST2 said:

In a complete coincidence (given what @Ennvoqation posted above), I have just ordered a brand new Caterham (!) - but depreciation is very low (you're looking 8-10 years old to get the % saving you'd get on a Ford at 2 years old) and there's no such thing as a standard Seven.

Aye, I want to spec my own Seven next year if I can pull it off. they're a beast to drive, especially when you're going above 370 spec. Been in one on a track day, and it throws shade on the RS for sheer raw visceral driving experience. Sometimes literally when you leave the roof at home in the Scottish weather!

[TimST2]

On 11/13/2019 at 7:50 PM, Ennvoqation said:

Aye, I want to spec my own Seven next year if I can pull it off. they're a beast to drive, especially when you're going above 370 spec. Been in one on a track day, and it throws shade on the RS for sheer raw visceral driving experience. Sometimes literally when you leave the roof at home in the Scottish weather!

Mine will be a 310R.

[StephenFord]

2 minutes ago, TimST2 said:

IIt'll be a weekend and track car that replaces a Lotus Elise that we owned for 14 years...

That is also freaky, another neighbour had one in which I had a drive in. It all went well till I tried to get out of the darn thing and fell promptly on my *****, that sill must be 2ft wide LOL

[TomsFocus]

I don't think there's any new car on sale today I could buy on my yearly 'salary'!

I hate owning old cars though...I've had 30+ cars in the last 10 years, all paid outright, never financed...  Guarantee I've spent more on repairs & depreciation and much more time worrying about them than if I'd just bought a brand new and kept that for 10 years... 

I'd consider myself fairly lucky with cars too, when I see the faults that people have on here, parts costing several hundred quid and then they have to pay hundreds of labour on top of that as well...all that spend on a car that's still depreciating heavily (even at 6+ years old) and that they're often having to pay high interest on finance for as well...  It makes much more sense to pay a bit more monthly in the long run imo.