How to get the best price when buying a new car?
In the past when buying a new car, there were few options. However now, there are a number of options and it can be confusing as to which will ultimately be best for your circumstances. There are two main ways to buy a car.
Buying outright / cash purchase
When you buy a car outright, you own the vehicle. You may fund this through cash savings you have or you may take out a loan, use a credit card or a combination of these things.
To buy a car outright, main dealers are of course the first port of call for my people. However an up and coming way of buying a car outright (at a cheaper) price is to use some of the websites which do the bargaining on your behalf and the arrange for a main dealer to supply the car to you directly. If you prefer to buy locally, you can still use these websites as a negotiation tactic to get a better price.
Contract hire / lease
With contract hire, you do not own the car and instead are hiring it. Much like you might hire a car when on holiday, but with this it is much longer term – typically 2 or 3 years. Contract hire is the most popular type of car leasing.
To get a car via contract hire, there are a number of companies who specialise this – both based offline and a growing number online. Main dealerships will also supply cars via this method.
Which is cheapest?
Historically, if you wished to buy a brand new car, planned to keep it for 3 years and had the cash available, buying a car outright was the cheapest method of car ownership . However in recent years some very good deals have become available contract hire, particularly with certain manufacturers. One reason some of the premium manufacturers do this is that they prefer to discount lease deals, as this is less visible. The new car ownership the biggest cost is depreciation, so to work out if a particular contract hire deal is better than buying outright, you need to look at the total costs over the ownership period (typically 2 or 3 years).