Used cars, people view cars on forecourt at Motorpoint Oldbury, 1st June 2020, via PAUsed cars, people view cars on forecourt at Motorpoint Oldbury, 1st June 2020, via PA


Most car buyers will consider finance even though only half are comfortable with the process

  • New research from Motors reveals strong appetite for dealer finance
  • Over three-quarters happy to consider finance for next purchase
  • This is despite only half are comfortable with process

Time 9:13 am, June 18, 2024

Over three-quarters of car buyers will consider finance options offered by dealers, even though only half admit to being comfortable with the process, new research has found.

Used car platform Motors found there is a strong appetite among buyers to source their finance through dealers, with 76% willing to consider the payment option.

Its latest Consumer Insight Panel research quizzed 2,008 people and found that nearly two-thirds (63%) of those who bought their last car outright said they will consider dealer finance next time around. While 94% of owners currently paying for their car on monthly instalments will consider dealer finance options when purchasing again.

The research also identified when consumers first start looking at how to finance their purchases.

Almost half (46%) first think about payment options before they start searching, 32% during the initial search stage, dropping down to 11% during the shortlisting stage and 11% during the final decision stage.

However, amongst those considering dealer finance only one in two (51%) say they are comfortable with the process. Over a third (34%) are neither comfortable nor uncomfortable, while 15% are uncomfortable.

The highest levels of discomfort are experienced by used car buyers, women and 18-24 year-olds.

Overall the biggest concerns raised by buyers were hidden fees (43%) and higher interest rates (43%), followed by pressure to sign on the dotted line (24%).

Lucy Tugby, marketing director of Motors, said: ‘Our research shows how dealers are the go-to option for finance for most car buyers, although the level of discomfort many feel should be factored in by all retailers.

‘The convenience of discussing and arranging finance at the point of sale is clearly a major selling point for most buyers but anything that can be done to put customers at ease with greater transparency could make a big impact on conversion.

‘The findings also identify just how important it is for dealers to actively promote their finance options online as over three-quarters of buyers first start to think about payment options in the early stages of their search journeys.

‘There is also an opportunity for dealers to grow their finance penetration by opening conversations with buyers who traditionally choose to purchase outright. Our research shows how the cost of living crisis is prompting many buyers to hold onto their savings and consider funded monthly payments instead.’

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. In October 2021 he became Car Dealer's associate editor.

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