Buyers holding off buying new cars and waiting for government to offer incentives first

Time 1 year ago

Buyers are holding off from buying a new car in the hope the government offers some kind of incentive, new data shows.

The latest weekly Insight from What Car? shows buyers are now delaying handing over their cash for a new car and instead waiting to see if the government jumps first and offers incentives.

‘Still we wait on whether the government will launch any incentives to encourage people to buy new cars, be it via a VAT reduction, a scrappage incentive or something else,’ said Rachael Prasher, managing director, What Car? and Haymarket Automotive.

‘What we can see is that the delay in announcing anything is increasingly holding back purchase decisions. Our data shows us that 45 per cent of new car buyers and 26 per cent of leasing buyers are now delaying their purchase in the hope of a scheme being given the green light.

‘Ironically, given they might be able to receive better savings, buyers of electrified cars are less likely to delay – although more than one in eight still say they are waiting.’

The What Car? data from a poll of more than 6,300 users also found that discounts on electrified vehicles have gradually increased during 2020.

In June, discounts stand at £1,614, or 4.16 per cent off list on average, while plug-in hybrids are offered with savings of more than £4,034, or 7.44 per cent.

What Car? also revealed that are potential buyers refusing to wait for their next car.

Prasher said: ‘Nearly 40 per cent of prospective new car buyers tell us they aren’t willing to wait more than four weeks for their next car, with 16 per cent switching to another brand if their waiting time cannot be met.

‘Importantly, 28 per cent of buyers also tell us that if the exact model they want can’t be found, they’ll switch to another brand, rather than wait for stock to arrive.

‘This is going to be a key battleground when it comes to electrified vehicles, given the challenges around availability.

‘In other words, those with stock in hand will gain, while those with restrictions on numbers will lose out.’

James Batchelor's avatar

James – or Batch as he’s known – started at Car Dealer in 2010, first as the work experience boy, eventually becoming editor in 2013. He worked for Auto Express as editor-at-large and was the face of Carbuyer’s YouTube reviews. In 2020, he went freelance and now writes for a number of national titles and contributes regularly to Car Dealer.

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