A car service plan is a fixed-price deal whereby you pay for a set number of services in a single transaction. This is usually arranged when you initially buy a car – either via an upfront cost or in monthly instalments – but can be added later as well.
What are they?
Service plans are a way to pay for routine servicing and maintain service history for your car for a set number of years and/or number of miles.
You can pay in one lump sum or in monthly instalments for a price that’s fixed at the current rates – which is something we’ll come back to in a moment. The number of services you pay for can vary, as can the level of cover.
Buyers can opt to pay for a basic service or more comprehensive cover as part of a particular manufacturer’s offer – for example, Volkswagen also offers tyre, alloy wheel and windscreen cover as part of one of its service and maintenance plans. On used cars, the deal might also include MoT cover.
The terms of the agreement mean you also get to service the car through a main dealer, which helps with residual values by ensuring a full manufacturer service history at the correct intervals. So while it may cost more than your local garage charges, you’ll end up with a car that’s worth more and should be easier to sell.
Do I need one?
If you want guaranteed servicing costs, then it may be worthwhile as the price is fixed at today’s rates. It also helps buyers manage the cost of keeping their car maintained, which makes it less likely important safety checks will be skipped and should maximise the vehicle’s reliability.
All of these are important factors at any time, but especially now, when the cost of living and inflation are putting seemingly ever-increasing pressures on personal finances.
You also get the reassurance of main dealer service from the manufacturer, which should mean your car is in the best possible hands and kept in tip-top condition through the use of genuine parts rather than third-party alternatives.
Even so, it’s still worth checking how much the services will cost individually as opposed to via a fixed-price servicing plan. A service plan should save you money, but do make sure this is actually the case.
You’ll also want to find out what’s included – wear and tear items such as tyres and brakes won’t be covered unless you opt for a plan that specifically looks after them as well.
Some plans – such as MINI’s TLC package – stay with the car and can be transferred to the next owner, whereas others do not. If you pay for a service plan and sell the car before it’s up, the money spent on it in advance will be lost.
Also, if you’re buying a car on PCP (personal contract purchase), aim to get a service plan thrown in to ensure that the vehicle is worth as much as possible when it comes to the end of the finance term.
Car leasing service plans
If you value the ease of having practically all of your motoring costs – bar insurance and fuel – in one monthly payment, you may want to consider ticking the maintenance box on a leasing deal.
Rather than having to save up to ensure you can afford servicing, new tyres, breakdown cover and other running costs, maintenance packs roll all of these into one monthly payment. Yes, these payments will be slightly higher, but you don’t have to find £250 here for a service, £200 there for a couple of tyres, £100 here for full breakdown cover.
Car leasing maintenance packs generally include:
> Breakdown cover including home-start, roadside assistance and recovery
> Scheduled servicing
> Replacement tyres (within fair wear and tear limits)
> MoTs (for cars over three years old)
> Exhaust and battery (within fair wear and tear limits)
