As the cost of living continues to rise, it’s becoming increasingly clear that people’s finances are under a lot of pressure. One area where consumers are feeling the impact of these rising costs is in the purchase of a new car.
According to a study by eBay Motors Group, 27% of car buyers will be spending more time evaluating affordability before buying their next car. This has led to car retailers being urged to support potential customers who may be feeling uncertain about purchasing during these challenging times.
This blog post will discuss the main results of the study and provide insight into ways that car dealerships can improve their support for customers who are facing financial difficulties.
Research shows that ‘Affordability is Key’
The eBay Motors Group’s Consumer Insight Panel research highlights that car buyers are particularly concerned about affordability, especially since a large percentage, around 70-80%, of people buy vehicles out of necessity.
Considering this, it’s understandable that 44% of those surveyed were affected by the increasing car prices and felt that it would prolong their hunt for the perfect vehicle. Additionally, 34% of respondents were taking into account the running expenses, while another 34% were searching online for the best offer. In addition, 28% of people had concerns about the possibility of transitioning to electric vehicles.
What types of cars are buyers looking for?
Does the current financial crisis and a more conscious approach to spending money have an impact on the types of cars people might consider buying? Well, according to research, 44% of car buyers are willing to wait for the specific car model they want, due to long lead times affecting the supply of some new models.
However, it was also found that 64% of people will consider purchasing used vehicles instead of buying new ones. Although the preference of 48% of people was for sub two-year-old nearly new cars, with finally, only 16% being interested in cars that are over two-years-old.
How Can Car Retailers Offer Financial Support?
According to the findings, consumers take approximately 42 days to search for a car, with car retailers now being expected to offer additional assistance to those who are currently searching for their next vehicle.
As the economy sees an ever increasing rise in consumer spending, people who want to buy cars are looking for different ways to finance their purchases. By offering financial incentives that are easy to access and providing supportive assistance, car retailers can help reduce the stress associated with buying a vehicle.
Flexible payment options might be considered, like contract hire, personal contract purchase (PCP), or personal loans can be helpful for customers who are hesitant to commit their finances to a vehicle in the current economic climate. Either way, it’s clear that it’s important to identify what’s best and cater to these customers.
Additional Help and Supportive Measures
Another area where car retailers can offer support is by providing customers with relevant advice on running costs. As electric options are gaining popularity, customers might need to get accustomed to range limitations, charging costs, and the availability of charging infrastructure.
As a result of their search, customers become more knowledgeable about their options, which benefits them, while car retailers benefit from having informed buyers who are confident in their choices. This can lead to increased loyalty and repeat business in the future.
Dealers urged to show support to cash-strapped car buyers as more than a quarter take longer to assess affordability amid the cost-of living crisis. @AMchatter coverage of our latest Consumer Insight Panel findings.https://t.co/9OkiJPrRqq— eBay Motors Group UK (@ebaymotorsgroup) April 21, 2023
As people are becoming more concerned about affordability, it’s important to understand the difficulties faced by those buying and selling cars. According to the recent study, car retailers can better assist their customers by offering financial incentives that are easily accessible, as well as providing advice on running costs.
Furthermore, to adapt to the changing economy, it’s important to welcome innovative ideas and work together to provide customers with a well-rounded shopping experience. By collaborating, customers can make well-informed decisions about their next car and contribute to the sustainability of the automotive industry.