Increase in Used Car Purchases Planned Over Next Three Months

The latest research from Motors' Consumer Insight Panel indicates a growing interest in buying used cars over the next three months, with 17.8% of in-market decision-makers planning a purchase, compared to 17% a year ago. This reflects a 5% increase year-on-year. Additionally, the proportion of buyers expecting to purchase by the end of 2024 has risen from 42.9% to 44.1%, a 3% increase.

In a detailed survey of 2,008 adults, the research highlights a significant shift towards monthly payment options, though outright purchases remain the most common method. Currently, 61% of owners bought their cars outright, but this is expected to drop to 53% in the next buying cycle. Conversely, those opting for finance or lease arrangements are set to increase from 28% to 33%, and monthly subscriptions will rise from 11% to 15%.

The average monthly payment for vehicles over two years old stands at £262, while nearly-new cars up to two years old average £306 per month. Lucy Tugby, Motors’ marketing director, emphasised the stronger intent among used car buyers compared to last year, with many already searching online for their next purchase.

The research identifies key demographic groups most likely to buy used cars. These include individuals under 35, often with young families requiring larger vehicles like SUVs, and older parents downsizing or purchasing "treat" cars after their children have left home. These insights suggest that dealers should consider stocking medium to large cars for young families and smaller, high-end vehicles for older buyers.

Moreover, the panel’s findings underline the importance of promoting finance options to align with consumers' budgets. Tugby recommends that dealers highlight various payment options, including monthly payments, both online and in-store, to attract more buyers. By doing so, dealers can potentially increase finance penetration and support customers in managing their budgets more effectively.

This trend towards increased used car purchases and the preference for monthly payment plans presents a significant opportunity for the motor trade. Dealers can capitalise on this by adjusting their stock and marketing strategies to meet the evolving needs of different customer segments. Emphasising flexible payment options and showcasing the benefits of financing can help attract a broader range of buyers, ensuring that dealers sell more cars and stay competitive in the market.

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