What To Know When Buying A Pre-Registered Car

Pre-reg and ex-demo vehicles can offer substantial new-car bargains, but why are they cheaper?

When new cars are registered to dealerships before they’re sold to customers, they become known as ‘pre-registered cars’ and they normally are sold with a hefty discount as a result. This is because, even though the car in question might only have covered a matter of a handful of kilometres, you’ll still officially be the second owner of the vehicle if you decide to buy it. Here’s what to know if you’re planning on buying a pre-reg.

  1. Know the difference between pre-reg and ex-demo

The reason pre-registered cars exist at all is because dealerships are offered bonuses from their parent manufacturer for meeting sales targets. They therefore order new cars in sufficient numbers to ensure they get the manufacturer bonus for themselves, using this money to offset the reductions they must offer on the pre-reg cars. The dealerships therefore anticipate a number of pre-reg sales on a brand-new model type, hence why they’re a bargain.

But ex-demo cars will represent even bigger savings for a buyer. As their name suggests, ex-demo cars are ones that are pre-registered to the dealership but then used for demonstrations and test drives for prospective customers. Therefore, they will normally have much more mileage showing on them than pure pre-reg vehicles, as they will have done plenty of work. The pay-off is that ex-demo cars are normally in a very high specification, with lots of standard equipment and optional extra kit, and they will represent an even bigger bargain when compared to the price of a shiny, unregistered example of the same car that is sitting in the showroom.

  1. Know the expected discounts

Normally, dealers will offer you something like 5-15 per cent off the price of the same car in brand-new, unregistered spec. If it’s a particularly popular car, one in high demand with the buying public, the discount will be smaller; if it’s a run-out car, due to be replaced by an all-new model in the near-future, the discount will be larger.

  1. Accept the spec

The idea of buying a new car, instead of a used one, is that you can go into a showroom, choose your preferred exterior colour, your interior colour, your desired engine and gearbox, the trim level and any optional extras – in essence, you are ‘personalising’ the car to your tastes. Pre-reg cars, however, are WYSIWYG: what you see is what you get. You have to accept the colour and equipment level, and you should be looking for a car that has done no more than 350 delivery kilometres in total and which is less than six months old.

  1. Be aware of the implications of being the second owner

We’ve already said that you won’t be the first owner of a pre-registered car, you’ll be the second… and that can affect other aspects of car ownership that you might not immediately think of. For instance, manufacturer warranties begin from the date a brand-new car is first registered, not when it was sold. So if you buy a six-month-old pre-registered car from a company that offers a three-year warranty, you’ll only have two-and-a-half years’ worth of cover remaining. Furthermore, some insurance policies will replace your brand-new car like-for-like if it is written off in an accident during its first year on the road. However, these policies will often include a clause that insists you are the first owner, so a pre-registered car would not be eligible for replacement. The subsequent valuation of the insurance company would also be for a two-owner car, as well, rather than a one-owner example, and that means it will be lower.

  1. Do your research

We touched on it briefly earlier on, but make sure you’re acutely aware of the model life-cycle of the vehicle you’re going to see. If it’s about to be facelifted or outright replaced, haggle as hard as you can to get a bigger discount than the dealer is offering. They need to meet sales targets and would rather shift the car on, than have it lingering around on their forecourt once a newer version is available. Remember, though, that the idea of pre-registered and ex-demo cars is that you’re after a new vehicle, but you’re not fussed about specifying it exactly to your tastes; that does give the salesperson something of an advantage, as it’s a case of you taking or leaving what is offered.