Disproportionate Taxation

I'm sure this is handled more clearly elsewhere, but it strikes me that the one of the ways the government could stimulate the economy is to look at the way that we're taxed.

In a recent discussion with someone that works 37.5 hours a week @ £7/hour (£260/week; ~£14,000/year), which places them in the bottom 10% of the earning population and represents about 1.8M people, revealed that £70 goes on Tax and National Insurance - 27%. This seemed to be an extraordinary amount.

On the one hand, the picture doesn't seem too bad if you look at the results from a percentage perspective - 27% is less than the 38% that higher earners typically lose. However, what gets missed when percentages are discussed is how significant each £1 reduction is in such a modest amount. 

I think that the issue that's missed is that the normal day to day costs that have to be met by the net amount are a significant percentage of the total. For example, the costs of going to work  - £45 on fuel & maintenance (100 miles/week @ 45p/mile from AA costs) plus childcare costs of £69, represents 60% of the net earnings. This leaves about £80/week for everything else...

For someone on the median earnings - £479/year (Table 1 - All Employees) giving £350 net (0.27 x £479) the same costs represents 33% - though losing over 30% of your income just getting to work still seems excessive. 

I think this could be addressed in two ways. Firstly, it seems to me that high earners (top 10% say) could wear a 1% increase in taxation that could translate in to a significant reduction in the lower rates paid. The logic being that if the top 10% of the population - who earn ~£1,000 week, pay an extra 1%, it could be passed on to the bottom 10% of the earning population as a reduction of 4% without any change in the Revenue's tax income.

Secondly, there needs to be a significant increase in the zero band threshold for lower earners - 10% tax band anyone?

Top Gear Challenge

Most of the challenges completed by Mssrs. Clarkson, Hammond & May over the years have been hugely entertaining, though I've often wondered why they've not competed in the Soap Box Challenge under a 'Green Initiative' (!)

In my mind, I can see Hammond and May working diligently and enthusiatically to build a traditional cart only to have Clarkson show up with a Street Luge board. Then, looking like a python who'd swallowed a medicine ball in his leathers, he'd win easily.

Though, there is the potential for a few disasters along the way..., which could add to the entertainment value :-)

The Damage

After a few days delay due to parts availability and the requirement for a new starter motor - the existing one had (developed...) an internal fault that meant another £178.41, I collected the car on Saturday, with a few interesting incidents...

• The invoice showed all the main parts as "RMFD." (e.g. RMFD. TRANS., RMFD Startermotor (sic)). When I queried what this meant, there was some dithering from the Service Advisor who tried to bluff for a few minutes, then went to get the Service Manager. He bluffed his way for a bit too - even to the point of saying "no parts are re-used", without ever clearly explaining what happened, though he did reassure me that the part was covered for 2 years and unlimited mileage, which is the same as a new part. I've since found a (slightly) fuller explanation from BMW here.
• The invoice also showed a number of "Surcharge on above" items (e.g. £591.30 for the transmission) that are refunded on the line below. This (apparently) is an 'internal' charge from BMW for the retrieval and inspection of the part. It's refunded if the part is returned to BMW. However, BMW will levy the full charge if the part is kept for independent inspection.
• Sytner had the car for 2 weeks but had only given it a cursory wash & vac, which was disappointing... Though the Service Manager did offer a full valet next time I visit as compensation. I hope that it's not before the next service is due!
• I mentioned the recommendation from Honest John about replacing the transmission fluid at every Service II to the Service Manager at Sytner. He didn't seem at all surprised and also said that "... a number of our customers ask for this to be carried out on gearboxes and diffs...". He also confirmed that it wouldn't affect the warranty on the parts/car. When I asked him why they (Sytner) didn't suggest it as good practice, he said that they "were very tightly controlled by the manufacturer" and that "BMW's position is that the parts are sealed for life and don't need the fluid to be changed". This seemed to be an area where Sytner could really add some value, but are not allowed to because of BMW's rules & regulations...

Total bill £2880.57 (yikes!).

BMW E46 Gearboxes

I found the following on Honest John's site here when I was doing some post-failure research on BMW gearboxes;

General Warning about Automatic Transmissions: Many BMWs have "sealed for life" automatic transmissions. Regardless of whether you have a full BMW service history, the dealer will never change the auto fluid. Many of these boxes are failing around the 120-150k mark - often well outside of warranty and to a cost of £3.5k plus VAT. A good independent or automatic transmission specialist www.fedauto.co.uk can and will change the fluid for you (and any good BMW independents will recommend this anyway). This is commonplace in the US and means the 'box should last the life of the car rather than being the cause of it being written off. General advice is ensure the fluid is flushed out every 60k or more preferably at each Inspection II.

Certainly something I'll have done on any future BMWs.

Ford Fiesta Zetec S - A (very) brief review

I've had to hire a car whilst the maintenance on the 330D Touring is completed. The cheapest I could find in Rugby were Enterprise who have loaned me a new model Fiesta 3 door with 446 miles on the clock.

Today I've done about 250 miles and have found the following (in no particular order);

Good

• Ride is excellent on most surfaces, though (occasionally) high frequency ridges get transmitted to the cabin, which made my head wobble about.
• The engine noise is quite low and doesn't really intrude in to the cabin.
• The car looks very smart in black with the body kit, alloy wheels and blacked out rear windows. 
• With all the snow & ice around, I've been very circumspect, but handling is good.
• Seats - even with limited adjustment are comfortable - except the headrests, which are very hard.

Bad

• Plastics in the cabin are hard and cheap.
• Cabin is very noisy at motorway speeds. Mostly tyre roar.
• There seems to be very little performance from the engine. The optimum is 2900-3200 RpM in 3rd.
• Having long doors can be a real hindrance in a car park. You have to open the door a long way to generate enough gap to get out.
• Seat headrests too hard.
• Rear 3/4 view is obscured by the very thick rear pillar.
• The water is not cleared well from the mirror glass in the rain, which affects visibility.

Odd

• The mirror glass had been put on the wrong sides. The glass with the curved outer surface (for wide angle visibility) had been fitted to the passenger's side and the drivers side was plain.
• The windscreen wipers are dramatically different in size, with the passenger blade being about a 1/3 the size of the main blade. At first it looks quite comical, but they work effectively enough.
• The rear brakes are drums, which makes sense from an engineering & cost perspective, but still looks cheap & nasty in the middle of an alloy wheel.

Having said all this, I've had to remind myself that this is a Fiesta and should really be judged in context. From this point of view, it is very good. I can't help thinking that if Ford had put some more effort in to NVH and the cabin materials, then (in the current climate) they would be taking sales from classes above.

Postscript

Have just received the final quotation from Sytner, who have also very kindly reduced their labour rates.

The original estimate for parts, labout and VAT was;

• Gearbox - £3,700
• Injector - £470
• Glowplug control unit - £226

Giving a total of £4,396

The revised quotation is;

• Gearbox - £2027.46
• Injector - £450.13
• Glowplug control unit - £209.67

Giving a new total of £2,687.26, which is a reduction of £1,710.

It is still a massive bill and it has taken a huge amount of effort to articulate my case to BMW in order to achieve this result. 

However, I've learnt my lesson and will ensure that I don't keep a vehicle - especially a BMW, past its 5th birthday.

BMW Customer Service

An update to yesterday's post.

Earlier today, I sent the following e-mail to Klaus Kibsgaard (MD, BMW UK), Chris Willows (Director of Corporate Communications, BMW UK) and Uwe Ellinghaus (Marketing Director, BMW UK)

Dear Mr Kibsgaard,

I am writing to highlight the completely unsatisfactory experience I’ve had with BMW ownership over the past 2 years.

I have suffered from very poor customer experience and excessive levels of unexpected maintenance.

Owning a BMW has wasted many days of my time, the financial costs have been significant and the disruption to my personal and business life has been extraordinary.

Your customer service team have been uncompromising, even though the car falls well within your goodwill guidelines.

I have tried to be reasonable, that hasn’t worked, so I’ll be making my experiences more widely known.

The detail are in the attached document, with a summary blog posting here and forum posting here. I will be posting more widely later today.

--

Best Regards

etc...

Although I am still waiting for a response to the email, I have (just) received a call from Jonny Combe - Customer Service Manager BMW UK. They have offered to contribute 50% towards the cost of the replacement gearbox. I am now waiting for the full details from Sytner.

As an aside, it seems to me that Sytner have missed an opportunity here to (a) generate a sale and (b) create a product champion. 

I would have responded very positively to a call from a (smart) BMW salesman who offered a suitable replacement vehicle with a good trade in value (typical AutoTrader private sale) against mine.

My logic is that the internal parts and labour costs are lower than a customer pays and there is no VAT. The 330D could be repaired and then sold on to the trade. The cost of the repair would be factored in to the discount on the replacement car... especially as I've seen prices drop by more than £3,000 on a £22,000 used BMW in a few weeks.

Sytner would have achieved a financing deal; sold some stock and had a succes story to talk about.

Perhaps there aren't any smart salesmen at Sytner?

A postscript and final costs here.