Rolling out new deals to entice vehicle buyers
29 May 2013|7,068 views
Automotive firms are coming up with innovative ways to entice car buyers put off by the recent cooling measures.
The arrangements are offered mainly by companies selling premium and luxury brands, as these are the ones most affected by the financial restrictions which have led to orders for high end cars being cancelled, and have put off many prospective buyers.
To counter this, for example, Porsche agent Stuttgart Auto has come up with a scheme that gives customers a Porsche Panamera sedan at $788 a month, for three years. Buyers will still have to fork out a 50 percent downpayment of $235,000. But at the end of the third year, the company buys back the car at $235,000.
Stuttgart Auto Sales Manager Jason Lim said the scheme attracted more than 150 inquiries over one weekend, but the actual take up rate was relatively low.
Nevertheless, motor firms said consumers still prefer traditional hire purchase deals as they are more familiar with them. They also like the idea of 'owning' their car.
But Mr Say Kwee Neng, Managing Director of BMW agent Performance Motors, said, "Do you ever actually own a car in a hire purchase agreement?"
Similarly, Mercedes-Benz dealer Cycle & Carriage is offering a deal that gives customers a Mercedes-Benz E200 for $3,577 a month via a seven year lease with no downpayment. Under a traditional hire purchase arrangement, they would need to cough up $124,000 up front, and make monthly instalments of $2,390 over five years.
The dealer's Chief Operating Officer Eric Chan said that multinational companies seem most receptive to leasing plans as they dislike the sizeable capital expenditures that come with hire purchase deals.
As for individuals, Mr Chan said that a lease is preferable for those who are financially savvy and able to get good returns from cash otherwise tied up in a car downpayment.
Automotive firms are coming up with innovative ways to entice car buyers put off by the recent cooling measures.
The arrangements are offered mainly by companies selling premium and luxury brands, as these are the ones most affected by the financial restrictions which have led to orders for high end cars being cancelled, and have put off many prospective buyers.
To counter this, for example, Porsche agent Stuttgart Auto has come up with a scheme that gives customers a Porsche Panamera sedan at $788 a month, for three years. Buyers will still have to fork out a 50 percent downpayment of $235,000. But at the end of the third year, the company buys back the car at $235,000.
Stuttgart Auto Sales Manager Jason Lim said the scheme attracted more than 150 inquiries over one weekend, but the actual take up rate was relatively low.
Nevertheless, motor firms said consumers still prefer traditional hire purchase deals as they are more familiar with them. They also like the idea of 'owning' their car.
But Mr Say Kwee Neng, Managing Director of BMW agent Performance Motors, said, "Do you ever actually own a car in a hire purchase agreement?"
Similarly, Mercedes-Benz dealer Cycle & Carriage is offering a deal that gives customers a Mercedes-Benz E200 for $3,577 a month via a seven year lease with no downpayment. Under a traditional hire purchase arrangement, they would need to cough up $124,000 up front, and make monthly instalments of $2,390 over five years.
The dealer's Chief Operating Officer Eric Chan said that multinational companies seem most receptive to leasing plans as they dislike the sizeable capital expenditures that come with hire purchase deals.
As for individuals, Mr Chan said that a lease is preferable for those who are financially savvy and able to get good returns from cash otherwise tied up in a car downpayment.
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