Browsing through the internet looking for motorcycles for sale is a bad habit. Most of us indulge in this guilty pleasure, but when selling expensive motorcycles, the dealer needs you to either have a very healthy bank balance or needs to find a way to make the bike affordable.
And when did motorcycles start costing £17,000 plus, anyway? I don’t think I paid that for the two bikes in my garage.
There have always been exotic models or homologation specials, but £17K and more for a production motorcycle sounds expensive, or am I just broke?
So, two questions come to mind. First, how do you sell someone a £17K motorcycle, and secondly, what could I get for £10K?
Before I dive into the internet, please remember that I write about motorcycles and can push buttons on a calculator. I’m not qualified to give financial advice. Before entering into any contracts or agreements, talk with someone qualified to provide financial advice.
Selling Expensive Motorcycles
Personal Contract Plans or PCP, as it is more commonly known, is close to a rental scheme. You pay a deposit and a monthly amount typically for three years. At the end of the three years, your options are:
- Part-exchange your current motorcycle for a new one. The future value of the motorcycle is set as part of the PCP deal.
- Pay the optional final payment and keep the motorcycle. This figure is different to the future value.
- Return the motorcycle and walk away, but you might want to check the figures first.
PCP Frameworks
PCP agreements sound simple enough, but there are a couple of things to be aware of.
You will set a maximum annual mileage, and if at the end of your PCP agreement you have exceeded this, the value of the motorcycle reduces accordingly.
You will need to maintain a main dealer service history, so if you need one of those costly major services during the three years you’re riding the bike, you have to meet that cost. Typically, servicing is not covered by PCP payments.
All the normal wear and tear items, tyres, brakes, oil etc., are all excluded from the PCP costs.
If all of that works for you, then (as I write this) a brand new BMW 1250 GS TE can be yours for £220 per month, or for £150 per month, you can have the R1250RS.
I used 10,000 miles per year and a £3,500 deposit in both cases.
Put another way, and perhaps the figure the salesperson might not mention is that your monthly payments will total £11,420 for the GS or £8,769 for the RS over the three years, plus servicing costs.
Trawling Autotrader, I found three BMW R1200RS models for sale. All are three years old, on a 68 plate, and all with less than 10,000 miles.
The pick of the bunch was an R1200RS SE, which came with Gearshift Assist Pro, Keyless Ride, Dynamic ESA, Adaptive Rider Modes Pro, and Heated Grips, for sale from North Oxford Motorrad, with less than 5,000 miles.
All three bikes could be yours for £10,000 or thereabouts.
The Maths Bit
So having paid £5,269 in repayments and my deposit of £3,500 (total £8,769) to BMW for the RS on PCP against a motorcycle that would have cost me £12,658 to buy outright, the bike would still be worth somewhere around £8-£10K – Right?
Not quite. You have to factor approximately £2,500 in interest on the money borrowed to buy the bike (PCP agreements are a type of loan). So, a settlement figure of around £6,300 at the end of the three years is more likely.
£12,658 to buy the bike, plus £2,500 in interest, minus £8,769 in payments including the initial deposit leaves a three-year balance of £6,258 or £6,300 if I round it up.
But the bit that the salesperson will focus on is the £150 per month. You are riding around on a brand-new BMW (or any other make) for a “low” monthly figure.
All perfectly acceptable and reasonable if that fits your circumstances.
Please remember these figures are just me with a calculator and not the deal you will do with a finance company.
What could I get for £10K?
Having discovered that for £10,000, I can have a low mileage, full dealer service history BMW R1200RS – I even found an R1200RS Sport SE with luggage for £9,800 – what else could I get for my money?
Surfing through Autotrader for motorcycles under three years old, with a minimum capacity of 900CC and less than 10,000 miles, I was offered 537 motorcycles to choose from.
Changing the search to only show new motorcycles, I get to choose between a KTM 890, Bonneville T100, Kawasaki Z900RS, Honda CB1000R and a Suzuki GSX-S1000, to name a few.
For me, the pick of the bunch was a Tiger Sport 850 with a pair of Triumph Expedition panniers, yet strangely without the pannier rails.
However, at £9,400 for a brand-new Triumph 850 Sport, I’ve saved enough money to buy them. Shirlaws in Aberdeen are the people to call if you are interested, but I can’t imagine the bike will be for sale long at that price.
All told, there were one hundred and seventeen motorcycles, all under £10,000 and all brand new, for me to choose from.
But you said £17,000
I had two motorcycles in mind when I started this article: the BMW R1250 GS TE and the new Triumph Tiger 1200 GT Explorer Pro, both of which retail at £18K and change.
Sadly, that is out of my price bracket, and I wondered how dealers would sell bikes that cost that much. I did ask the Editor for a pay rise. He said No.
The Beemer with 10,000 miles per year and £3,500 deposit would cost me £220 per month or thereabouts. I added a couple of the BMW packs to the basic bike, but I can’t work out how to put this figure into the BMW PCP calculator.
I could always call a dealer, but I don’t trust myself not to do something stupid.
The Triumph Tiger 1200 Explorer GT Pro, on the other hand, according to the Triumph calculator, will cost me £234 per month for 37 (yes 37) months if I use the same £3,500 deposit and 10,000 miles per year.
Both bikes would be on PCP deals and have the same 7.9% interest rate.
And that, it appears, is how you sell a £17,000 or £18,000 motorcycle when you could buy a new bike for under £10,000. Essentially, you don’t. Instead, you sell an £18,000 motorcycle for £220-£235 per month. That is a neat trick.
Clarity
There are a lot of figures in this article, all of which I obtained from the manufacturer’s websites. I’ve no idea if these are good deals or not. Please remember that I write about motorcycles and can work a calculator. I’m not qualified to give financial advice.
