As we head into the start of a new financial year, what can vehicle owners and buyers expect in the coming months? New releases are due to hit our shores but multiple existing models in the market are on recall. How does a recall affect your car loan and what repayments can you expect on a new release? We review some of these key car-buying questions.
Multiple Vehicle Models Recalled
It’s been a busy time for vehicle recalls with multiple makes and models appearing on the ACCC website in the May-June period to date. In May, several Suzuki models were recalled and more recently luxury German automaker BMW has recalled 11 models. The nationwide BMW recall is due to a manufacturing fault being identified in the hydraulic unit brake booster. The recall covers multiple new sedans, coupes, SUVs and convertibles.
Porsche has also recalled a number of its 2021 model Cayenne and Cayenne Coupe due to issues with the clamping nuts on the rear axle trailing arm. Also on the recall list in June are the 2020 model Audi A7s and A6x with a dash panel issue. The petrol-electric system on the 2019-2021 model year Honda Accord Hybrid has also triggered a recall.
Minor issues with spark plugs are reportedly behind a recall of 2020 Mercedes-Benz AMG 45S and CLA45S. A few GLA and GLC SUVs are also recalled with a possible problem with the software that could cause the emergency call function to be inactive.
Vehicle and other product recalls are not unusual. Manufacturers regularly recall their products when issues, faults or the potential for issues to arise are identified. But it can be a concern and inconvenience for busy owners who have to address the matter.
In most instances, manufacturers or dealers will contact the owners of affected vehicles, so it is important to keep your details up to date with the dealership. Regarding the current recalls, details of the issues and lists of the affected VINs can be found on the ACCC website. More info here.
Recall Impact on Finance Contracts
When a vehicle is recalled the event should have no impact on motor vehicle finance. In most cases, any issues will be rectified by the manufacturer at no cost to the owner. Individual arrangements would need to be made if a vehicle was off the road for an extended period regarding a replacement vehicle.
Being unable to use a vehicle does not mean a car loan borrower can pause loan repayments. The loan repayment schedule must be adhered to, whether or not a car is operational.
New Vehicle Releases
With manufacturing delays caused by a coronavirus in 2020, many carmakers are now facing delays due to a shortage of computer chips. This is reportedly affecting many factories across the globe with numerous new releases pushed back by months. With car sales surging in Australia and business buyers keen to buy to take advantage of temporary full expensing, any shortage in supply will be a blow to local dealers.
Pre-orders are being taken by some manufacturers and keen buyers should stay across news of their preferred models so as not to miss out. A great way to ensure you are well-prepared when the new stock hits the market is to pre-arranging your finances.
Jade Car Loans provides a pre-approved loan service for both business vehicle finance and personal car loans. Applications for these loans are handled in the same way as for loan applications made after the vehicle is selected up to the approval stage. The loan is pre-approved, awaiting final details of the buy and the invoice from the dealer to complete the exact loan amount.
Pre-approved loans include the same cheap interest rates which are fixed, a fixed loan term and fixed repayments. The loan is approved for a certain timeframe which will be advised at the time. There is no obligation attached to pre-approved loans so if the buyer does not proceed to purchase and use the loan, there is no problem. This is a very effective way to approach car finance and an approach that is used by many buyers.
So what new releases are worth capturing now or waiting for?
The new Kia Cerato has just been launched in Australia with a sedan, hatch and sporty GT. Pricing is highly competitive at $35,000-$37,000 plus on roads. Head to our car loan repayment calculator for businesses to see how that plays out in repayments. Supply continues to be a problem for Kia so it’s great that this model has made it to market.
Originally expected in the third quarter of this year were the Audi E-tron GT, Silverado Trail Boss, several new Hyundai models, Jeep Grand Cherokee L and Land Rover Defender, and several new models from Mercedes-Benz including the Maybach. VW also has several new models as does Volvo. With COVID-19 and computer chips playing havoc with the global economy, the exact dates for release will likely be TBA.
Estimating Loan Repayments Before Purchase
Car buying decisions are made for a large range of reasons and some buyers, recalls and new releases will be taken into consideration. But by far the biggest priority for most buyers is knowing what their loan repayments will be on a certain vehicle. The price tag is great for giving you an idea of where the model is pitched in the market and a rough indication if it’s in your price bracket. But what is far more relevant is the monthly repayment on a loan for that vehicle.
To enable buyers to quickly and easily calculate loan repayment estimates, we’ve provided several loan calculators. These are free to use and can be used for as many vehicles as you are considering.
Private buyers can use the business car finance interest rate tool tool which displays both advertised rates and comparison rates for our Secured Car Loan and loan products from other lenders. The car loan repayment calculator tool is great for comparing Chattel Mortgage against Leasing as well as different priced vehicles.
To ensure you’re in a position to capture a new model when first released, start organising your car finance today.
Contact 1300 000 003 to discuss your motor vehicle finance requirements.
DISCLAIMER: IN REGARD TO MISREPRESENTATIONS AND ERRORS CONTAINED IN THE MATERIAL AS PRESENTED, LIABILITY IS NOT ACCEPTED. THE DETAILS AND CONTENT IS PROVIDED FOR CAR BUYERS AND INDIVIDUALS AND BUSINESS SEEKING FINANCE PURELY AS GENERAL INFORMATION. THIS IS NOT PROVIDED AS THE ONLY SOURCE OF FINANCIAL INFORMATION. ANYONE THAT CONSIDERS THAT NEED FINANCIAL ADVICE ABOUT THEIR SPECIFIC REQUIREMENTS SHOULD SEEK THEIR OWN FINANCIAL ADVISOR.