Checking the costs of importing a car

Answering all your motoring queries

From Eoghan Barry:My wife will be buying a new Honda FRV in January. We see that it is available in the UK with a 2.2-litre diesel engine but this engine is not offered here. Has Honda any plans to offer this version here?

We would consider importing as new from the North. I believe the tax band would be Band D, with C02 emissions of 168g/km. Would Revenue be difficult about valuing it for VRT purposes, given that the same model is not available here? Would there be any complications regarding warranty, servicing, parts, etc we should be aware of?

A:Honda Ireland says it has no plans to introduce the 2.2-litre diesel here. Instead it offers the 1.8-litre petrol in both manual and automatic starting from €29,585. This is available in automatic, something that's not offered on the diesel.

The Revenue should have no difficulty estimating the VRT on it. They put values on cars far more obscure and wacky than a Honda people-carrier.

Remember to enquire for a ballpark figure from Revenue before making the purchase in the North.

Then judge the total price of purchase against the cost of the 1.8-litre petrol. The diesel savings in fuel only come with sizeable annual mileage and the difference in terms of road tax between the two is only €170.

In terms of warranty and servicing, Honda Ireland says it will honour any warranty deals done with British dealers, though this does not apply to imports from all countries so other readers should check before buying.

From Colm Duggan, Dublin 2:With all the focus for reducing CO2 emissions on bio-fuels and diesel, why is nothing said anymore of LPG fuel?

A:There are two problems with LPG here. First and foremost, supply is limited as many forecourts don't offer it any more. It was popular several years ago because of its lower price but the conversions required and higher fuel consumption means it has lost its popularity.

In terms of consumption and emissions, it has worse fuel consumption figures than either petrol or diesel, but has 10-15 per cent lower emissions than petrol, about the same as diesel.

As LPG is derived from a fossil fuel so it still releases greenhouse gases into the atmosphere, so its not the answer to our carbon issues.

From TB, Cork:We're buying a new car but plan to wait until the New Year. However, the dealer is seeking a deposit and it forced us to look into the various financing options. It's very confusing. With the trade-in and some cash we've got about 50 per cent of the car price, but need to finance the rest. Any advice?

A:The car loan market - like every other credit facility - has tightened significantly since the economic downturn. Access to loans are being scrutinised more strenuously by the finance houses. It makes sense to shop around, and not simply accept the finance on offer from the dealer. The main ways to finance a car purchase are a regular loan or hire purchase agreement.

With a loan, you borrow an amount and make regular repayments for a set period on which you are charged a variable or fixed rate of interest. A hire purchase agreement is slightly different, in that while you pay back a set amount of money at a fixed rate of interest each month, here you only assume ownership of your new car once the final repayment has been made.

Then there is a choice of fixed-rate or variable-rate loans. In leasing, the bank or finance company lease the vehicle to you at a fixed monthly rental for a fixed term. The bank or finance company owns the car and charges you for its use. The interest rate for a leasing agreement is fixed for the term of the agreement.

As with hire purchase deals, it means that you can't access the value of the car you've paid for if you suddenly find you need the cash. Be sure to ask any dealer or finance house if the package is a normal loan or a hire purchase agreement.

Be wary also of balloon payments. These are large sums repayable in the last months of the arrangement that are often much higher than the other earlier payments. A key piece of advice is to try and match your repayment plan with the length of time you'll have the car. A longer-loan term may mean lower monthly repayments, but may well cost you more over the lifetime of the loan and it's no fun paying off a car long after it's left your driveway.