Best new car deals 2021

Thinking of buying a new model? Check out our list of the best new car deals right now

Don’t just dive in and buy a brand new car without doing your research first. After all, there could be a brilliant new car deal on the very model you’ve been considering, or even one that means you can afford a car you thought was out of your price range. And you too could be driving a brand-new 71-plate car.

We’ve gone through all the major car manufacturers to find the best new car deals for 2021, focusing on Personal Contract Purchase (PCP) plans, since most people use this type of finance to buy new cars.

There are three main things you need to keep an eye out for when bargain hunting. The deposit, monthly repayments, and optional final payment are all key to getting a great deal, and if you’re not sure about what those are, read our handy PCP guide

It’s also important to know the interest rate, the length of the agreement, the mileage limit and the size of any deposit contributions the manufacturer will make. Most of our deals assume you’ll be putting down a deposit of around 10 to 15 per cent, and will be covering around 8,000 miles a year.

Top 10 best car deals this month

  1. Volkswagen Polo – £222 per month
  2. Mercedes A-Class - £225 per month
  3. Skoda Octavia - £329 per month
  4. Dacia Duster - £217 per month
  5. Nissan Juke - £243 per month
  6. Volvo XC40 - £319 per month
  7. Ford Kuga - £285 per month
  8. BMW 3 Series - £343 per month
  9. Nissan Leaf - £269 per month
  10. MG ZS EV - £343 per month

How does PCP finance work?

More than 90 per cent of the new cars sold in the UK are purchased using some kind of finance, so while list prices are often referred to, monthly figures and deposits are arguably more relevant. Most car makers have their own version of a Personal Contract Purchase (PCP) and they all work in the same way.

PCPs are best thought of in three parts: the deposit, the monthly repayments, and the optional final payment. The deposit is the cash you’ll put down up front. This can either be a straightforward lump sum, the value of your part-exchange, a deposit contribution from the manufacturer, or a combination of all three.

The size of the deposit will affect the size of your monthly repayments. These are typically made over a 24, 36 or 48-month period, but can be scaled up or down to suit your circumstances. The final part is the optional final payment, which is sometimes referred to as the ‘balloon payment’. Your deposit and monthly payments only go part of the way to paying off the car; in fact, they’re actually paying off its depreciation over the time you’ll have it. To own the car you’ll need to pay the full amount off, but not every buyer does.

Many drivers use the car’s ‘equity’ as the deposit on their next one. This ‘equity’ is made up of overpayments you may have made, since makers often overestimate how much a new car will depreciate to play it safe. This quirk of PCPs means you might not necessarily have to find a big deposit each time you take out a new deal.

If you don’t want to own the car outright or roll any ‘equity’ into a new deal, your third option is to hand the car back with no additional payments, and walk away.

Other ways to finance

Few buyers have the means or motivation to spend tens of thousands of pounds in one go. So while PCP deals are the most popular finance option, retailers also have an alternative, called Personal Contract Hire (PCH).

PCH

Also known as personal leasing, PCH deals require less capital up front. After an ‘initial rental’ or up-front payment, you make a series of regular payments until the agreement ends, after which you hand back the car and walk away.

While there’s no large deposit, unlike a PCP, which offers a reasonable degree of flexibility, a PCH will tie you in for the duration, with no option of handing the car back early without a financial penalty.

Hire purchase

Not many people choose hire purchase now, but it’s still possible to take out an old-fashioned HP agreement on a new car.

Put down a deposit then make monthly repayments that, unlike with a PCH or PCP deal, pay off the value of the car. At the end of the term you own the car outright.

HP agreements are secured against the vehicle, so tend to offer more attractive interest rates than those offered with unsecured bank loans, for example.

Cash, cards & loans

The days of cash being king are long gone in the new-car market and you may find the deals offered via this purchase method are less attractive than those available were you to take out a PCH or PCP deal.

Credit cards offer consumer protection against purchases of between £100 and £30,000, but have heavy interest rates. A bank loan with an attractive interest rate is another route. You’ll pay cash for the car, so dealer discounts are harder to come by.

Choosing the right car for you

Below we’ve highlighted some of our top choices in a range of categories. These are our considered recommendations, but they won’t suit everyone. You should spend time ensuring that the model you choose has the space, style, economy, and performance you need.

Once you’ve drawn up your shortlist, call round dealers to book test drives, and put the car to good use. Make sure you, and anyone else who will be driving it, is satisfied and can find a suitable driving position behind the wheel.

Take the kids along to ensure they can get comfortable, too, and that it’s easy to get child seats in and out. And if you have hobbies with specific requirements, make sure the car is up to the job.

Scroll down below for our list of the best new car deals available right now, listed by category...

Best new car deals 2021

Best city car deals

Hyundai i10 - £199 per month

  • Model:Hyundai i10 1.0 100PS N-Line
  • Per month: £199
  • List price: £16,400
  • Deposit: £2,500
  • APR: 4.8%
  • Deposit contribution: £500
  • Number of payments: 36
  • Final payment: £5,705 
  • Total paid by customer if returning: £12,048
  • Total paid by customer if keeping: £17,753 

A reasonable enough interest rate and a £500 deposit contribution sweeten the deal on this Hyundai i10 N Line, which adds hot-hatch styling without the running costs associated with a junior performance machine, thanks to the city car’s 99bhp 1.0-litre engine.

Also featured are 16-inch alloy wheels, i30 N-aping exterior detailing, a leather sports steering wheel and gearlever, plus Hyundai’s great 10.25-inch touchscreen, with sat-nav. Put £2,500 down and you’ll be paying just under £200 a month over four years for this car.

Kia Picanto - £212 per month

  • Model:Kia Picanto 1.0 GT-Line 
  • Per month: £212
  • List price: £13,850
  • Deposit:  £1,385
  • APR: 4.9%
  • Deposit contribution: £1,000
  • Number of payments: 36
  • Final payment: £5,062
  • Total paid by customer if returning: £9,019
  • Total paid by customer if keeping: £14,081

This deal runs for three years and gets you Kia’s capable Picanto city car for a little over £200 a month with a 10 per cent deposit. The interest rate may be an industry-standard 4.9 per cent, but a £1,000 deposit contribution is decent for this size of car.

If you’d prefer a shorter term, go for a 24-month deal and you’ll get zero per cent interest, albeit without a deposit contribution. Either way, GT-Line will ensure your Picanto looks the business, with twin exhaust pipes, an eight-inch touchscreen and tinted windows.

Best supermini deals

Honda Jazz - £159 per month

  • Model: Honda Jazz i-MMD CVT SE
  • Per month: £159
  • List price: £19,445
  • Deposit: £4,413
  • APR: 5%
  • Deposit contribution: £500
  • Number of payments: 36
  • Final payment: £10,707
  • Total paid by customer if returning: £10,638
  • Total paid by customer if keeping: £21,345

Honda can occasionally struggle to match the might of some firms’ finance offers, but putting just under 25 per cent of the Jazz’s asking price down as a deposit means the monthly repayments on the Japanese supermini fall to £159, while an interest rate of five per cent is about par for the course. 

The 1.5-litre petrol-electric hybrid powertrain offers 96bhp and promises an official 62.8mpg. SE trim, meanwhile, includes climate control, automatic wipers, heated door mirrors, Bluetooth and LED headlights.

Renault Clio - £189 per month

  • Model: Renault Clio TCe 90 Play
  • Per month: £189
  • List price: £16,900
  • Deposit: £4,489
  • APR: 0%
  • Deposit contribution: £250
  • Number of payments: 24
  • Final payment: £7,625
  • Total paid by customer if returning: £9,275
  • Total paid by customer if keeping: £16,900

As with the Captur featured further on in our rundown, this deal from Renault bundles a small (but still welcome) deposit contribution with zero per cent interest, making for a rather attractive overall package. 

Put just under £4,500 down and you could be driving around in our 2021 supermini of the year for less than £200 a month. This generation of Clio represented a sea change in Renault cabin design and quality. You’ll be getting a DAB radio, full smartphone connectivity, climate control and a decent roster of safety kit, too.

Toyota Yaris - £189 per month

  • Model: Toyota Yaris Hybrid Design
  • Per month: £189
  • List price: £22,150
  • Deposit: £5,199
  • APR: 0%
  • Deposit contribution: £0
  • Number of payments: 41
  • Final payment: £9,203
  • Total paid by customer if returning: £12,947
  • Total paid by customer if keeping: £22,150

Toyota may not be offering the magic combination of a deposit contribution and a zero-interest deal, but given the popularity of the Yaris, it arguably doesn’t need to. Besides, you get zero-per-cent APR here.

Put a little over £5,000 down and the Yaris comes in at under £200 a month, or £2,127 down brings the monthlies to £234. Design trim includes LED headlights, an eight-inch infotainment system and 16-inch alloy wheels. The 1.5-litre three-cylinder petrol engine and hybrid motor return close to 70mpg.

Volkswagen Polo - £222 per month

  • Model: Volkswagen Polo 1.0 TSI 95PS United
  • Per month: £222
  • List price: £18,395
  • Deposit: £1,840
  • APR: 4.8%
  • Deposit contribution: £1,500
  • Number of payments: 47
  • Final payment: £6,663
  • Total paid by customer if returning: £12,326
  • Total paid by customer if keeping: £18,989

You can pick up a Polo for a little under £2,000 down and £222 a month, thanks to a £1,500 deposit contribution from VW. Opt for this deal and you’ll get a reasonable rather than stellar 4.8 per cent interest rate over four years, leaving you with an optional £6,662 to pay at the end of this 10,000-mile deal. 

United trim comes with 16-inch alloys, blue/grey upholstery, a leather-trimmed steering wheel, satellite navigation and automatic windscreen wipers, plus smartphone mirroring on the infotainment system.

Vauxhall Corsa - £225 per month

  • Model: Vauxhall Corsa 1.2 100PS SRi
  • Per month: £225
  • List price: £19,915
  • Deposit: £3,027
  • APR: 3.9%
  • Deposit contribution: £1,250
  • Number of payments: 47
  • Final payment: £6,796
  • Total paid by customer if returning: £13,602
  • Total paid by customer if keeping: £20,398

The relatively new Corsa SRi can be yours for a little over £3,000 down and £225 a month with this deal. Vauxhall is offering a £1,250 deposit contribution, but if you trade in your old car you’ll get a further £1,000 off (this isn’t factored in to our calculations). 

SRi trim features a seven-inch touchscreen with full smartphone connectivity, plus climate control, a sporty bodykit and digital dashboard dials. If the electric Corsa-e takes your fancy, there’s a £3,000 deposit contribution, for £4,322 down and £269 a month.

Kia Rio - £247 per month

  • Model: Kia Rio 1.0 ‘2’
  • Per month: £247
  • List price: £17,050
  • Deposit: £2,000
  • APR: 4.9%
  • Deposit contribution: £1,500
  • Number of payments: 36
  • Final payment: £6,127
  • Total paid by customer if returning: £10,888
  • Total paid by customer if keeping: £17,015

The interest rate on this deal is a so-so 4.9 per cent, but with Kia chucking £1,500 towards a fairly modestly priced supermini, the effect is almost the same as an interest-free deal. In fact, you’ll end up paying less than list price after three years, should you decide to make the final payment. 

Going for 2 trim helps keep the price down further, and while this won’t add the sporty trappings of GT-Line guise, you will get 15-inch alloy wheels, power-fold mirrors, upgraded upholstery, cruise control, all-round electric windows and Kia’s excellent touchscreen system with full smartphone connectivity. 

The Rio’s 1.0-litre turbo petrol engine is punchy and refined, and offers decent fuel economy, while the boot is surprisingly roomy for the supermini class. Don’t forget Kia’s seven-year warranty, either.

Best hatchbacks deals

Mercedes A-Class - £225 per month

  • Model: Mercedes A 180 SE
  • Per month: £225
  • List price: £24,100
  • Deposit: £3,928
  • APR: 4.9%
  • Deposit contribution: £1,654
  • Number of payments: 48
  • Final payment: £10,560
  • Total paid by customer if returning: £14,721
  • Total paid by customer if keeping: £25,281

Instead of billing it as a straight ‘deposit contribution’, this offer comes by way of a discounted ‘retailer offer price’ compared with Mercedes’ list price for the A 180.

But a rose by any other name smells just as sweet, and the effect is that this deal gets you an A-Class for a little over £200 a month with just under £4,000 down – not bad for a properly desirable premium family hatch, and a car that has become a common sight on our roads over the past couple of years. On the strength of this deal, it’s easy to see why that’s the case.

Toyota Corolla - £229 per month

  • Model: Toyota Corolla Hatchback 1.8 Hybrid GR Sport
  • Per month: £229
  • List price: £28,925
  • Deposit: £6,610
  • APR: 0%
  • Deposit contribution: £1,000
  • Number of payments: 41
  • Final payment: £11,926 
  • Total paid by customer if returning: £15,999
  • Total paid by customer if keeping: £27,925 

A smaller deposit will obviously make the entry point into Corolla ownership lower and bring higher monthly repayments, but even allowing for £6,610 as a fairly chunky initial payment, this is a decent deal.

Toyota is offering both zero-per-cent interest and a £1,000 deposit contribution here, while GR Sport trim adds even greater visual panache to the Corolla, and gives this sensible, efficient hybrid a subtle bodykit, sports suspension, 18-inch alloys, sport seats, a head-up display and full smartphone integration.

Kia Ceed - £300 per month

  • Model: Kia Ceed 1.0 ‘3’
  • Per month: £300
  • List price: £22,355
  • Deposit: £2,500
  • APR: 4.9%
  • Deposit contribution: £2,500
  • Number of payments: 36
  • Final payment: £8,480
  • Total paid by customer if returning: £13,290
  • Total paid by customer if keeping: £21,770

Kia’s commendable family hatch does a lot of things right, and this offer adds a chunky £2,500 deposit contribution to the Ceed’s roster of attractive traits. Go for this deal and with £2,500 down, you can plant a Ceed on your driveway for close to £300 a month.

Opting for 3 trim brings 17-inch alloys, part-cloth, part-synthetic-leather seats, dual-zone climate control and a 10.25-inch infotainment system. There are also a few subtle upgrades, such as lumbar support for the driver’s seat and satin-chrome cabin details.

BMW 1 Series - £304 per month

  • Model: BMW 118i M Sport
  • Per month: £304
  • List price: £28,755
  • Deposit: £4,313
  • APR: 3.9%
  • Deposit contribution: £829
  • Number of payments: 47
  • Final payment: £12,096
  • Total paid by customer if returning: £19,414
  • Total paid by customer if keeping: £31,510

This 1 Series offer from BMW isn’t as attractive as the one for its arch rival, the Mercedes A-Class further on in our rundown of deals, but it’s reasonable enough.

A 3.9 per cent interest rate is backed up by a deposit contribution of just under £1,000, leaving you to make 47 monthly payments of £304 over four years. Do so and at the end of the deal you can either hand the car back, use any difference between the car’s residual value and what you’ve paid to go towards a new BMW, or stump up the final balloon payment and own the car outright.

SEAT Leon - £307 per month

  • Model: SEAT Leon 1.0 TSI 110PS SE Dynamic
  • Per month: £307
  • List price: £21,685
  • Deposit: £2,169
  • APR: 0%
  • Deposit contribution: £0
  • Number of payments: 35
  • Final payment: £8,771
  • Total paid by customer if returning: £12,914
  • Total paid by customer if keeping: £21,685

SEAT’s range of offers currently focuses on 36-month terms and interest-free PCP deals rather than eye-catching deposit contributions and lower monthly payments over a longer period of time.

The canny buyer will know such an offer can be attractive, and here it means getting a new Leon for £307 a month, with just over £2,000 down. SE Dynamic trim adds digital dials, nav and 17-inch alloys. This deal is for the current Leon, rather than the previous model our readers fed back on in our Driver Power rundown.

Skoda Octavia - £329 per month

  • Model: Skoda Octavia 1.5 TSI 150 SE L

  • Per month: £329

  • List price: £26,000

  • Deposit: £3,010
  • APR: 0%
  • Deposit contribution: £1,250
  • Number of payments: 36
  • Final payment: £10,225
  • Total paid by customer if returning: £15,775
  • Total paid by customer if keeping: £26,000

While sister firm SEAT is offering zero-per-cent interest deals across its three cars highlighted in this rundown, Skoda goes one better by matching that and adding in a meaningful deposit contribution. 

That allows you to put the latest Octavia (not the previous-generation model featured in our top 75 cars in July) outside your home for £3,010 down and £329 a month over a 36-month contract. This deal includes metallic paint and a 148bhp 1.5-litre engine, 17-inch alloys and a 10-inch infotainment screen.

Click on to page two for more of our best new car deals...

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