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Foxhound5366
Executive Member
- Joined
- Oct 23, 2014
- Messages
- 9,135
So I've seen a rise of 'guaranteed future value' deals, which are really just a fancy way of selling consumers residuals that are so high that they wouldn't have taken the deal any other way.
It's really clever marketing: you've gone from being glum that your car will have lost half its value by the time you want to trade it in; to being happy that you've been guaranteed that it will be worth 50% of its value when you want to trade it in 0.o
Surprisingly enough Toyota's jumped at this in a big way, not only with their Fortuner (which traditionally was meant to hold its value anyway), but now even its Quest (which I'd have expected would be the same thing).
The sticky part here is that Toyota is clearly under-selling the future value, presumably so they score more at the end of the deal (that's pretty much where all their profits get deferred to).
Case in point: http://www.toyota.co.za/guaranteed-future-value/corolla-quest
Why on earth would Toyota be proud of the fact that a brand new Quest (with limited mileage no less) will be worth *only* 52% of its value after 48 months?
The even crazier part is that you're going to be paying R152 160 for a car that was only worth R183 900 anyway, except at the end of it you're going to hand back the car and Toyota's going to make a big profit when they sell your Quest for a fair bit more than the R95 628 they gave you to settle that big residual value they convinced you to take so happily.
Now don't get me wrong, I'm all in favour of residual payments where they can sometimes enable you to buy a class of car that you could never have afforded otherwise ... and the money you effectively lose on the deal is essentially a tax on the enjoyment you experience on the awesome car. However, the Quest deal boggles my mind: you're paying a serious amount of money for an average car, and you won't see a dime of value back after only four years.
It's really clever marketing: you've gone from being glum that your car will have lost half its value by the time you want to trade it in; to being happy that you've been guaranteed that it will be worth 50% of its value when you want to trade it in 0.o
Surprisingly enough Toyota's jumped at this in a big way, not only with their Fortuner (which traditionally was meant to hold its value anyway), but now even its Quest (which I'd have expected would be the same thing).
The sticky part here is that Toyota is clearly under-selling the future value, presumably so they score more at the end of the deal (that's pretty much where all their profits get deferred to).
Case in point: http://www.toyota.co.za/guaranteed-future-value/corolla-quest
Why on earth would Toyota be proud of the fact that a brand new Quest (with limited mileage no less) will be worth *only* 52% of its value after 48 months?
The even crazier part is that you're going to be paying R152 160 for a car that was only worth R183 900 anyway, except at the end of it you're going to hand back the car and Toyota's going to make a big profit when they sell your Quest for a fair bit more than the R95 628 they gave you to settle that big residual value they convinced you to take so happily.
Now don't get me wrong, I'm all in favour of residual payments where they can sometimes enable you to buy a class of car that you could never have afforded otherwise ... and the money you effectively lose on the deal is essentially a tax on the enjoyment you experience on the awesome car. However, the Quest deal boggles my mind: you're paying a serious amount of money for an average car, and you won't see a dime of value back after only four years.
