7:54 am, May 23, 2022
One in five car buyers say the cost of living crisis will make them delay their next purchase.
That’s the finding from new research carried out by eBay Motors Group. Its Consumer Insight Panel quizzed of over 3,000 in-market new and used car buyers during the second week of April, the week after energy regulator Ofgem’s cap on energy costs was increased.
The rise in energy bills prompted nearly a quarter (23 per cent) to say they will delay their next car purchase, while a further 29 per cent will now buy a cheaper car and 20 per cent will buy a smaller one.
However, 28 per cent said the rise would not influence their decision.
When asked how the general cost of living increases would affect their next car purchase, 23 per cent said they will delay, 30 per cent said they will buy a cheaper car and 19 per cent now looking for a smaller car.
Over a quarter (27 per cent) said it will not have any influence.
Although the rising cost of petrol and diesel will impact the decisions of 70 per cent of buyers, most of the respondents said they will go ahead and buy with 28 per cent opting for a cheaper car and 23 per cent a smaller car, while 19 per cent will delay their purchase.
However, 31 per cent say these rises will have no effect.
The research also identified the limited impact of the rises in National Insurance Contributions (NIC) and council tax.
Only 17 per cent said they will delay their purchase because of the NIC rises, while 40 per cent said it will have no effect on their plans.
Similarly, just 18 per cent said council tax rises will delay their next purchase, while 39 per cent said it will have no impact. The balance in both cases say they will buy cheaper or smaller cars.
Dermot Kelleher, head of marketing and research at eBay Motors Group, said: ‘Our research shows how the cost of living crisis is having a real impact on the decisions made by a significant majority of car buyers.
‘While for most of these buyers it will mean a pragmatic shift to cheaper and smaller cars, which in itself may be challenging as advertised prices for used cars are still tracking up 20 per cent year on year, what is apparent is that one in five buyers will delay their next purchase.
‘The challenge for dealers is to help buyers understand the overall affordability of their next purchase beyond the purchase price and how it can be balanced against their increased living costs.
‘Dealers are ideally placed to advise on the lower running costs of some smaller and cheaper models and this will be appreciated by customers reining in their budgets and making some tough choices.’
