Car buyers can save £1300 by choosing a PCP over cash

New car PCP costs have risen by more than 40% on some models since 2019, but there are still significant savings on some models...

Volvo XC40 TP

The cost of buying some new cars has risen by more than 40% in the past three years due to price increases, higher interest rates and lower deposit contributions from car makers, according to research by What Car?'s team of Target Price mystery shoppers. 

We compared the average monthly personal contract purchase (PCP) payment for five popular car models – the Ford Puma, Mini hatchback, Seat Ateca, Volkswagen Golf and Volvo XC40 – now and in 2019. Overall, the monthly PCP payments for these models have risen by 23%, with the XC40 recording a 43% rise in average monthly payments.

The XC40 cost £356 a month on a four-year PCP deal three years ago, but now the monthly payments have jumped to £508. The increase is partly due to a 28% increase in the average purchase price for the model, from £35,037 to £44,724, and a 78% rise in the APR charged on the finance deal, which is up from 6% to 11%. 

The research highlights the impact of the months of Covid lockdowns, semiconductor chip shortages and the rising cost of living on the motoring sector. While three of the five models compared were cheaper to buy via finance than cash in 2019, all five models cost more to buy via finance today. Below, we show the average increase in monthly PCP payments for all five models researched. 

Ford Puma 

Ford Puma 2022 front drive past
Ford Puma Price now 2019 price Percent increase
On-the-road price £28,414 £23,410 21%
Target Price £26,746 £22,540 19%
Monthly PCP  £315 £257 22%

Read our full review of the Ford Puma or check out the latest deals >>

Mini hatchback

Mini 3dr front right driving
Mini hatchback Price now 2019 price Percent increase
On-the-road price £28,082 £22,066 27%
Target Price £27,265 £20,519 33%
Monthly PCP £344 £276 25%

Read our full review of the Mini hatchback or check out the latest deals >>

Seat Ateca

Seat Ateca 2022 front cornering
Seat Ateca Price now 2019 price Percent increase
On-the-road price £32,873 £29,610 11%
Target Price £30,407 £25,294 20%
Monthly PCP £426 £322 32%

Read our full review of the Seat Ateca or check out the latest deals >>

Volkswagen Golf 

Volkswagen Golf GTD front
Volkswagen Golf Price now 2019 price Percent increase
On-the-road price £31,110 £27,668 12%
Target Price £29,299 £23,728 24%
Monthly PCP £400 £316 27%

Read our full review of the Volkswagen Golf or check out the latest deals >>

Volvo XC40

Best hybrid small SUV 2022 - Volvo XC40 front
Volvo XC40 Price now 2019 price Percent increase
On-the-road price £44,724 £35,037 28%
Target Price £42,242 £33,136 28%
Monthly PCP £508 £356 43%

Read our full review of the Volvo XC40 or check out the latest deals >>

* All prices are the average for the model stated on a three to four-year PCP deal with a 15% customer deposit. 

Still great deals to be had

However, What Car? Target Price analysis also reveals that significant savings are still available on some models. In fact, some of Britain’s most popular models can be purchased for less by paying via a PCP deal rather than cash

The biggest saving of £1362 is on a Toyota C-HR 1.8 Icon, which can be had for an overall outlay of £27,968 on a 3.5-year PCP deal; the on-the-road price for this model is £29,330. The saving is a result of a deposit contribution of £1250 and an APR of 1.9%.

Toyota C-HR 2022 front right tracking

It's also worth considering other manufacturer deals with higher interest rates, because some are more than offset by large deposit contributions. We found a deal on a £34,750 Lexus UX at 6.9% APR, with a £3000 manufacturer's deposit that helped to bring the overall cost down to £34,055, giving buyers a saving of £695. 

The 10 best PCP deals 

Make and model On-the-road price PCP total price Saving % Saving £
Toyota C-HR 1.8 Icon £29,330 £27,968 4.6% £1362
BMW 530d xDrive M Sport  £57,050 £55,848 2.1% £1202
Ford Ecosport 1.0 Titanium £23,435 £22,548 3.8% £887
Lexus UX 250h £34,750 £34,055 2.0% £695
Volvo XC90 2.0 B5P Core £61,995 £61,457 0.9% £538
Toyota Yaris 1.5 Design £22,520 £22,292 1.0% £228
Renault Arkana 1.3 140 Techno £28,795 £29,308  -1.8% -£513
Toyota Corolla 2.0 Excel £34,545 £35,075 -1.5% -£530
Ford Kuga 2.5 ST-Line Edition £37,755 £38,324  -1.5% -£569
Volkswagen Arteon 1.5 TSI R Line £38,660 £39,248 -1.8% -£588

* All cars are on a three to four-year PCP deal, with an annual mileage of 8000 to 9000 miles and a customer deposit of 15%. 

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