With a PCP, depending on deals and promotions it’s literally deposit and monthlies which can make a more expensive car with low depreciation just as affordable as a smaller cheaper car with average depreciation.
Same for leasing and the reason the R deals were so fantastic five years ago (god that time went quickly!) off the back of the minimal assumed depreciation VW based their calculations on using the mk6 R as its reference.
The GFV on PCP is a marketing tool as much as the list price, deposit contributions or interest rates. I've seen dealers on other forums discuss this (about BMW!). It has little bearing on the actual residual value of the car in most cases. One guy talked about how those three things vary, depending on the time of year. One minute its less interest, next its more deposit contribution or less GFV. Probably its actually working out net the same, just trying to attract you with an "offer".
And yes, my two Mk7's were on paper higher value cars than I would have chosen normally but the way PCP works, I paid less than I would for say an equivalent Skoda.
I could buy a car outright, chuck the equivalent monthly payments back into a savings account but even the fact that I'd be ditching any interest on the loan, my problem is the risk element. I definitely want rid of it after 3 years, but with PCP I know what that figure is at that point - if I sell it myself, the risk that I have got that GFV figure right for myself is on me.
Particularly right now, how do I know that a juicy petrol burner is going to have any particular value from now? (given the current world of electrification, rising VED and bans from urban areas we will see coming) Obviously VWFS have a figure in mind, but if they get that number wrong its not my problem. If I get it wrong and its 3 grand different, that will have made that car very expensive for me to have owned for 3 years and I won't know that until 3 years time.
That's why PCP/PCH is attractive - you know how much it costs for 3 years and for each month.
