Between stay-at-home orders and busy lives, trying to shop for a car is cumbersome. That was the case before online car shopping with Cazoo.
One of the UK’s largest online used car dealerships, they have more than 2,000 team members throughout the United Kingdom, France, Portugal, and Germany. If you are in the market for a used vehicle, step into the 21st century of car buying with Cazoo.
So what is all the hype about? Keep reading to learn everything you need to know in this Cazoo review. We will explain what Cazoo is, how to purchase, finance, or take out a subscription. We will also give you the nitty-gritty on selling your existing vehicle on Cazoo.
What Is Cazoo?
Opening in February 2020, Cazoo is the cheapest way to purchase a used car online and have it delivered to your home in the UK. The purchase comes with a 7-day money-back guarantee, so if you are unhappy with your decision you can return the vehicle.
This format is an excellent choice for anyone looking to purchase a quality vehicle for a new driver fresh out of traffic school. You and your teen can shop together online, make a purchase, and have the vehicle delivered to your doorway.
Cazoo Sold to SPAC
Cazoo is being bought by SPAC, a blank-check company for the price of $7 billion. This will allow Cazoo, which is based in London, to be listed in New York. Cazoo is expecting sales to increase by 300% in 2021 as a result of this purchase.
The anticipated sales growth is based on the success of Carbana Co., which took similar business steps in 2017. That led to a 400% jump in their sales during a 12 month period.
A Special Purpose Acquisition Company (SPAC) has no commercial operations. Its sole purpose is to raise capital by way of initial public offerings with the intent of acquiring an existing company. SPACs are also known as blank check companies and have been in existence for decades.
SPACs are allowed two years to complete the acquisition of a company. If they do not meet that deadline they must refund all funds to the investors. In the United States, there are more than 50 SPACs, raising collectively $21.5 billion.
Buying a Car on Cazoo
Using the Cazoo database you designate filters to indicate the type of vehicle you are looking for. At the time of this writing, the website lists 3,102 cars for sale, so you are sure to find something to your liking.
When shopping you may designate the make, model, features, and price to narrow your search options. View important details such as the vehicle service history, emissions, and photos of the automobile you are looking to purchase.
There is no negotiating on the purchase price. When you look at a vehicle the pricing is firm. All cars Cazoo lists are no more than six (6) years old and pricing begins a £4,200.
To be available for sale every vehicle must pass a 150-point internal inspection test. This takes place at their 55-acre storage facility in the Midlands. The company promises delivery of your purchase within 72 hours.
Every vehicle comes with a minimum six-month Ministry of Transport (MOT), plus a 90-day warranty and RAC roadside assistance. The MOT rating verifies that the vehicle is safe, roadworthy, and meets UK exhaust standards.
Selling Your Car on Cazoo
If you want to have a part exchange you can receive an instant valuation on the Cazoo website. You begin by completing an online valuation form regarding your existing vehicle. The factors given consideration in determining the value of your vehicle include:
- Car age—newer vehicles usually have lower mileage
- Number of owners—fewer owners is more desirable
- Car condition—fewer scuffs, scrapes, scratches on both exterior and interior increases value
- Service history—full, partial, or no maintenance service performed on the vehicle impacts value
- Current market prices—based on what current valuations are of other vehicles of the same model and year
There are no additional fees for the process. Simply find the vehicle you want using the Cazoo website and obtain an evaluation of your existing car. The part exchange value is taken off your purchase price.
Cazoo picks up your part exchange car on the same day you take delivery of your purchase.
Financing Your Purchase
Once you find the car of your dreams on Cazoo, you can apply for financing and sign the agreement online. You pay your deposit online and schedule a car delivery or pick it up at a Customer Centre.
There are various finance options available when purchasing from Cazoo. They are not a lender but will seek to find a competitive rate for your purchase.
You may select Hire Purchase (HP), which provides you the ability to spread payments for your vehicle out over a specific period of time. By making a higher monthly payment, you own the vehicle at the end of the agreement period. This payment option has no mileage limits.
With a Personal Contract Purchase (PCP) you will make monthly payments during the period of the agreement. If you decide to keep the vehicle at the end of the agreement period, there will be a larger final payment due at that time.
The PCP agreement provides you with three end of agreement options:
1) You hand the vehicle back into the finance company in good condition and the agreed-upon mileage limit
2) You do a part exchange on the vehicle for another car with a new agreement
3) You make the final repayment due and own the vehicle.
Personal Contact Purchase payments are usually lower than on a Hire Purchase agreement. This is because of the larger final payment at the end of the agreement period.
You also need to pay interest on the value of the car at the end of the agreement term. For this reason, PCP may be the more expensive option.
Take Out a Cazoo Subscription
If you elect to purchase a Cazoo subscription, you will receive a new car, insurance, servicing, maintenance, and tax for a flat monthly rate. When you exercise this option you have access to vehicles with the latest technology and features. You may select to subscribe for 6, 12, 18, or 24 months.
The shopping process is similar to that of a used vehicle. Using your Cazoo app decide on the car you want, the length of the contract, and whether you want to have home delivery or pick up the vehicle. You then apply for your subscription.
Once you complete your application Cazoo will check your driving history, affordability levels, and provide you with an eligibility determination within two working days. If you receive approval, you need to make a deposit equivalent to two monthly payments. Your subscription provides you with comprehensive insurance coverage from NIG.
You will be able to drive up to 1,000 miles per month. If you will likely drive more than 1,000 miles a month you may add additional mileage to the package.
Tax, maintenance, and servicing are included in your subscription. In the event of a problem, your subscription includes 24/7 roadside assistance.
Ending Your Subscription
At the end of your subscription period, you may turn in the vehicle and walk away. You also have the option of keeping it on a month-to-month basis for the same monthly payment. If you drove in excess of your allowable mileage you will need to pay £0.40 per mile for agreements made after May 18, 2021.
When taking out a subscription you have the same 7-day trial period you do when making a purchase. If you travel more than 250 miles in that trial week you will need to pay £1 for each mile you are over.
The Delivery Process
When you buy a car on Cazoo the vehicle you purchase will be delivered to your location within 72 hours. You may select a two-hour delivery time slot between 8:00 am to 8:00 pm on all seven days of the week. Cazoo delivers throughout the mainland UK free of charge.
Free delivery saves you extra, as you have no expense for petrol or trains to conduct vehicle views or pickups. Many dealers in the UK charge for delivery.
Cazoo also provides you with free “seven-day driveway insurance.” This provides you with free insurance that will cover damage, theft, and loss to the vehicle during your initial seven days of ownership.
If you need to file a claim within that time you will be liable for £500 excess. If the driver is under 21 there will be a £750 fee.
Money-Back Guarantee
While you can’t take a test drive before buying, you do have seven days to test the vehicle after purchase. If you decide you do not want the car simply turn it back in for a free refund.
There is a maximum of 250 miles for the test week. If you go over on mileage and turn the car back in there will be a charge of £1 per mile.
Keep in mind that car-swapping as a way of test driving is not a financially sound decision. Cazoo offers a 7-day money-back guarantee on only one vehicle per year. This means you can only return one car free of charge every 12 months.
If you decide to return a second vehicle, you will need to pay a £100 collection fee. There is also a £75 fee for valet services if you turn the vehicle in and it is not clean.
Cazoo Review Summary
Summarizing this Cazoo review, if you are looking to purchase a vehicle in the UK, Cazoo is an excellent choice. The company has a nice selection of vehicles and meets the needs of those looking for used cars and new vehicles. By selling to SPAC the company is likely to grow immensely, making it an excellent choice for investors to consider.