Almost a third of Brits (32%) are planning to hold on to their current vehicle for longer than planned because of the cost-of-living crisis, according to new research by Close Brothers Motor Finance.
As inflationary pressures continue to squeeze household budgets, the findings suggest that many families are deciding to cut back on larger purchases. As well as the 32% of consumers who are holding onto their current vehicle for longer than planned, more than one in ten (11%) drivers have sacrificed the vehicle they wanted in favour of a cheaper car, and nearly 9% would consider buying a motorbike instead to save on travel costs.
11% of people said they were exploring finance options in order to be able to afford their preferred car. When asked where they’d turn to help spread the cost of a car purchase, almost a quarter of all consumers (24%) would look to specialist finance providers. 17% would use a bank loan, 9% would use ‘buy now, pay later’, and 4% would borrow from friends & family.
On the other side of the fence, nearly all dealers (88%) believe that the cost of living crisis has influenced consumers to be more cautious about buying vehicles. Two thirds of dealers (66%) said that their customers are buying cheaper vehicles, while 52% said they were cutting back on additional optional extras. A huge 69% said their customers were buying more second-and cars.
Lisa Watson, Director of Sales at Close Brothers Motor Finance, said: “As inflation continues to bite, it’s clear that drivers are having to think particularly carefully about big ticket purchases. It’s another challenge for the industry, after a tumultuous few years.
“For those looking to buy, it’s important to do your homework. Research the makes and models you’re considering buying, to make sure you’re getting the right price, specs, and add-ons. Work out what’s feasible in your budget, and talk to your dealer about which form of payment is the best for your financial circumstances.
“For dealers, data and insight has never been more important. By using the right tools, dealers can ensure they’ve got the right stock on their forecourts, at the right price, in order to meet changing customer needs head-on.”
