Volkwagen PCP mileage question

[Guest]

Hi there,

In 2015 I decided that it was time to get myself a car as I changed jobs.

I went ahead with VW (Lookers Volkwagen) and signed up to a PCP plan on a new 65' plate Golf Match 1.6 TDI.

This was set at 20K mileage per annum and was £394.00 per month
'
6 months later (admist the Emmision Scandal that rocked VW), I went in to do a service and got offered an upgrade to a 16 plate GOLF GT 1.6 TDI.

I was also given £1000 contribution due to the above, which made my payments £393 per month ( a saving of £1).

So a simple like for like (the old car was reading at 12k/20k miles) at the time of the swap, so it was well within.

I agreed to the terms and signed to this deal very happy of course!

Two years on, I've looked back on at my finance documentation and can see that they signed me up on 5k per annum over 4 years at £393.00 per month.

5k per annum on such a car wouldn't be £393.00 a month on a 16 plate GOLD GTI, so clearly they made a mistake, yet I did sign the agreement thinking it was 20k as per what was verbally agreed.

So as you can imagine, I'm currently on 48k miles and that means 38k miles over, which at 7.3p per miles is a hell of a lot in excess!

Is there anything that can be done? Do I have to pay back this excess mileage if I voluntarily end the contract or can I part exchange this for another car without paying excess (I'm assuming that the value of the car will be so low now)?

I just need a way out because I feel they reduced my mileage per annum yet kept my payments the same as when I had the 65' plate.

Thanks,

J

[Justin1984]

Apologies, the above post is actually mine.

Any advice would be well appreciated.

J.

[Kati]

tagging R0b xx

[R0b]

Were you explicitly told the details of the agreement that it would be 5k per annum, or given any information to read? Did you explicitly tell the sales person that you wanted to keep the same mileage, and was there any witness with you who can corroborate your story?

It could be deemed as a misrepresentation if you entered into the contract relying on the representation from the sales person that the requirements remained the same or you were given that impression. It is not uncommon for sales persons to not inform them of the annual mileage presumably in the hope that this is all set out in the small print which the majority of people don't ever read.

Unfortunately as you are two years down the line, you might encounter some difficulties in actually trying to terminate this contract. You could try a formal complaint and point out that the annual mileage is 5k instead of 20k per annum. I would suspect that VW will tell you to go away and they won't accept your version of events. You could then proceed to taking it to the Financial Ombudsman but they are not as helpful generally so it would be pot luck I guess. Otherwise you could wait it out and see what happens and then try to defend it at a later stage but either way you look at it, there's going to be a risk.

The only thing that you might have going for yourself is the difference between the mileage in your previous contract compared with the new one. It would seem odd that you would have agreed to a 5k per annum mileage limit when your previously agreed mileage was 20k - that is some discrepancy and looking at it objectively, it is unlikely that you would have agreed to that mileage, particularly if you can prove what mileage you did in your old car.

If I were to guess, VW will say that you should have read the contract prior to signing it and because you didn't you were bound by the terms. However, where there is a case of misrepresentation, all you need to show is that a statement of fact was made, which you acted in reliance and subsequently turned out to be false resulting in loss to you. The courts have previously confirmed that it is irrelevant as to whether or not you looked at the contract details, it's the false statement and reliance on that statement which is key.

If you paid a deposit by credit card then you might be able to claim via your credit card company but given that were are not talking about a few hundred quid, I suspect you will get the same initial response from them too.

[Justin1984]

Hi Rob,

Thank you very much for the above, it's given me some

Unfortunately I had no one there at the time who could corroborate my story,

I also never paid a deposit for the initial 65' plate, but I know that the upgraded car based on 5k miles per annum wouldn't ever amount to £393 per month.

I think the FOS may be a good call.

I have no issues seeking out the end of my contract, I guess I'm just worried that I will have a backlog of excess mileage fees.

Thanks once again.

J.

[R0b]

I am not sure what you mean when you say the upgraded car would not amount to £393 per month, surely it must do because you are paying that each month aren't you?

It's likely that the salesperson or their manager will have done some fudging to get those figures and the monthly instalments down to that amount. PCP agreements are based on lenders assuming a guaranteed value at the end of the contract so if the miles are 5k instead of 20k per annum, then they would expect the vehicle to still have a good re-sale value given the smaller number of miles of the period of the contract.

If you stick it out to the end of your contract then return the car without paying the balloon payment, you are contractually bound to pay the excess mileage, whereas if you voluntarily terminate the agreement then strictly speaking you shouldn't pay for any excess mileage but that is also a grey area. If you refuse to pay the excess fees they will no doubt take you to court over it then you will probably have to counterclaim for misrepresentation and let the court decide. As I mentioned above, it doesn't seem logical that you would agree to reduce your annual mileage by 15k so if it did end up in court for whatever reason, the judge might be asking questions about that.

Not much more I can do in terms of help I'm afraid, but as the FOS is free, might be worth a try since they look at what is fair and reasonable.

[Justin1984]

Thanks again Rob,

What is mean is that (even though I am paying it) the monthly for upgraded car wouldn't normally be priced so high, it's as though they calculated it based on 20k and gave me a contract with 5k.

The car on 5k Miles per annum would be well under the £300 per month mark.

Proving that would be hard, as I would need the dealership to value how much they would have charged for that car based on those miles on PCP.

Thank you very much, as you're given me a clearer insight into what I can do.

J.