Skoda Rapid deals compared: Skoda 100% finance offer vs EMI holiday scheme

Skoda is pulling out all stops to push sales of the Skoda Rapid in a slowing market. Following its EMI holiday offer last month, the company is now introducing 100% finance on the ex-showroom price across all models of the Skoda Rapid.

This deal is valid for a limited period from April 8, 2013, up to April 18, 2013. The earlier offer of an EMI holiday too has been extended till the end of April, so you now have a choice of two deals to pick when buying a Skoda Rapid. Also read: March deals: Skoda Rapid EMI holiday

Skoda Rapid deals compared: Skoda 100% finance offer vs EMI holiday scheme

How does this work out for you? Let’s look at the economics of buying the Skoda Rapid on the 100% finance scheme as well as the EMI holiday offer, and see which one of these would suit you best. For the purpose of this calculation let’s look at what you will pay on a Skoda Rapid Elegance diesel, priced at Rs. 9.71 lakh ex-showroom Delhi.

Which Skoda Rapid offer suits you best?

Just look at the comparison of the two offers in the table below:

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The interest rate for the 100% finance offer is 10.75%, while on the EMI holiday scheme it is at 11.75%. With the EMI holiday scheme you have to pay about 50% of the price of the car as down payment and the rest as EMI for 36 months, beginning after one year only, while in the 100% finance offer you pay zero down payment, but EMI payment is for 60 months from day one. Yet the EMI holiday scheme works out cheaper, as you end up saving about Rs. 1.96 lakh overall on the ex-showroom cost of the car at the end of your EMI period (four years).

In addition to the prices mentioned above, there are the insurance, road tax and registration charges, which are not included in the finance scheme. This amounts to a further Rs. 1.10 lakh on both (including insurance), so that is a constant here. You could bargain a bit on the insurance front, but otherwise there is not much more you could get as a discount here.

This scheme is being financed by Skoda Finance, a brand of Volkswagen Finance Private Limited.  Also read: Skoda Rapid diesel road test and review

What we think

So looking at both the finance offers from Skoda, it’s quite clear to you as a buyer, if you have some spare cash around, it is better to pay that as a down payment on the car and avail of the EMI holiday scheme, as you end up saving Rs. 1.96 lakh on the ex-showroom price. But if you really need a car right now, but don’t have enough to pay for the down payment, yet could set aside about Rs. 21,000 a month, the 100% finance offer works for you, although you will end up paying a significantly higher overall price for the car, despite the lower interest rate and longer tenure as the loan amount is larger. Also read: Skoda offers buy 1 Rapid get 1 Fabia free