Six-in-10 motorists target car purchase in next 12 months

Car buyers are "releasing the handbrake" on their purchase plans, with six-in-10 planning to buy their next vehicle within the next 12 months, according to new research.

Close Brothers Motor Finance found that buying intention is on the rise, after a period of hesitation prompted by the cost of living crisis, and could be set to accelerate further.

Its data indicated that a further one-in-13 (8%) of the 2,000 respondents to its latest ‘The Road Ahead’ research “haven’t decided yet/don’t know” whether they will buy a car in the coming year.

The insight coincides with new research from eBay Motors Group which indicated 43% of car buyers expect to start looking for their next vehicle this year, with most (26%) planning to begin searching from July.

The eBay Motors Group's latest Consumer Insight Panel polled the views of 2,000 car buyers in March and found one-in-10 had either already started looking or planned to do so within a month.

Lucy Tugby, marketing director at eBay Motors Group, said: "Our research reveals a strong appetite among car buyers, especially young parents, to search and purchase in 2023, which will be welcome news for all car retailers.

“While some of these purchases will be the result of natural replacement cycles, as owners look to trade-in older cars, the strength of the desire to start searching also suggests some families are once again considering big ticket purchases, as they work their way through the cost-of-living crisis."

Lisa Watson, director of sales at Close Brothers Motor Finance, said: “The demand in the car market has been strong throughout 2023, and is beginning to return to pre-COVID levels.

“Sales, as well as production, are accelerating with latest figures showing the UK new car market achieved an eighth consecutive month of growth. And this trend looks set to continue with more car owners planning to buy a car than not.

“The increase in the popularity of AFVs indicates how the consumers are taking great steps on the road that leads to the eventual phasing out of petrol and diesel vehicles. Although the popularity of petrol remains in place for consumers for now.”

According to Close Brothers’ research car buyers continue to favour petrol-powered vehicles, with almost a third (32%) of those surveyed claiming they were going to opt for one as a quarter (26%) look to purchase or lease a hybrid car and one-in-seven (14%) will opt for a pure electric vehicle (EV).

Just one in eight (12%) will look to get a diesel car in the next 12 months.

A quarter (24%) of respondents said that they would buy or lease a used/second-hand vehicle in the next 12 months, with almost a quarter (23%) stating that they would opt for a new car.

Watson said: “The second-hand market is seeing an influx in demand as more people seek affordable options. But in order to meet this demand, the onus remains on car dealers to utilise available insight to stock forecourts and meet fluctuating demand. And that may remain difficult following a year in which slow manufacturing hindered the new car market and thus the second-hand market.

“Car buyers may need to be prepared to shop around if there is limited stock or long waiting times for the car they want, and speak to car dealers to ensure that they’re getting the right model, engine type and finance option for them.”

Last month a survey of 873 in-market consumers by What Car? indicated that the number of people planning to buy their next car entirely online had fallen to just 4% in recent weeks, as buying habits shift back towards the traditional showroom model.

Just 4.2% respondents told What Car? they expect to buy their next car entirely online, with delivery to their home address. This is down from 9.7% in June 2022.