[Tankshell]

Hi guys,

I was just reviewing the small print of the Peugeot Passport plan (http://www.offers.peugeot.co.uk/passport), and one particular section raised an eyebrow:

- - - - - - -- - - - - - -
- - - - - - -
- - - - - - -
- - - - - - -


"What happens at the end of the contract?

At the end of the contract you can:

<ul>[*]Pay the optional final rental and continue to drive the car by paying an annual rental equivalent to one of your monthly rental
[*]Hand the car back with nothing further to pay (subject to mileage and condition)
[*]Part exchange your car for a brand new one
"
[/list]- - - - - - -- - - - - - -
- - - - - - -
- - - - - - -
- - - - - - -


The part in bold is what concerned me. So imagine you pay off the final rental, so now you have paid the entire value of the car back to Peugeot (plus a bit more I imagine via interest).

Is this sentence now suggesting that even though the car is fully paid for, you still have to pay another rental fee to Peugeot every single year for remainder of the lifetime of the vehicle?


If so, that sounds rather bad form.

Edited by: Tankshell

 

[ar24]

I believe it is suggesting that. So for example if your monthly payments during your Passport Personal Lease are £200 you'd pay a £200 annual rental each yeah when your lease runs out. That's on top of paying your Optional Final Rental payment.

It does sound ridiculous after paying the final payment.

I've ordered the Allure through the Just Add Fuel Passport scheme, you can pay the optional final payment and own the car outright.

 

[Frank Bullitt]

It's standard form. Basically, the Passport is equivalent to an operating lease which means there are tax benefits so that Peugeot can offer the benefit to the customer in the deal (and keep a bit for theme selves no doubt of course) but the downside is these tax benefits mean the item can never be owned as this would make it a financing lease which in simplistic terms is comparable to a traditional PCP plan - the tax breaks don't apply but you can own the item at the end.

It's been common for ages in the fleet market as there is no interest in owning the vehicle at the end, it's essentially an operating liability rather than capital asset; Peugeot aren't alone in offering such deals and the work very much on the principal that nobody ever really wants to own the car at the end - if they do then a traditional PCP is more applicable, but then it's a pretty none-sensicle way to buy a car as you pay more interest than on HP (although the lower deposit/ monthly payments make it appear more attractive).

I'm never clear what happens if people did take this up then pay to 'own' the car and want to sell it; I assume that as the new buyer doesn't have the benefit of the tax breaks then they pay Peugeot who pay the 'vendor'.

Somebody might be able to explain it better than that but, to be honest, it's in all te small print on the various offers on the Peugeot site and comparisons etc. so in this case caveat emptor; buyer beware.