Auto finance clarity urgently needed as cost of living crisis sees drivers with older cars keep their vehicles longer – Car Dealer Magazine
More than half of drivers with older cars are keeping them longer due to the cost of living crisis.
That’s according to new research from Motorpoint, whose survey of 2,000 UK drivers with cars over 10 years old found that for 57% of them worries about the current financial situation means they have intend to keep their car longer.
The independent car retailer also found that using an older car also caused financial anguish for some motorists, as the study highlighted some repair bills that ran into the thousands.
Almost one in 10 admitted they weren’t even entirely sure how much their aging car had set them back, while more than a fifth (21%) believe they’ve spent more on repairs over the past a given year than they think for their entire car. really worth.
Almost two-thirds (64%) said unexpected car repair bills caused them stress, while 44% had experienced two or more surprise bills in the past year.
Almost a third (31%) have had a bill of £400 or more in the past year for an unscheduled but essential maintenance item, while 10% have had a single bill of £1,000 or more .
More than four in 10 (43%) admit that they think it can be more economical to buy and use a newer car rather than continuing to maintain their old one.
Motorpoint CEO Mark Carpenter said: “It is important when budgeting for a new car to consider maintenance costs, which will be required throughout its life.
“In the current climate, many motorists will be looking to weigh the benefits of keeping an older car they may own versus financing a new one that can meet their needs for extra space, lower emissions, improved economy and security. equipment.
“For those with a vehicle that has become unpredictable or changing needs such as a growing family, it is important to understand the options available, such as a fixed monthly payment and a vehicle with warranty protection to manage repair bills, and to be sure it’s affordable.
More than one in three respondents (36%) said a lack of awareness of car finance options led them to keep an old car rather than upgrade it.
Nearly half of drivers surveyed (46%) planned to replace their car within the next three years, while a quarter say they will use the financing to buy it.
Twenty-six percent are unsure whether they will pay cash or use financing to spread the cost.
But 23% said they would be more open to using finance if they had someone who could explain the options to them. More than half (58%) said they found car financing terms confusing.
Carpenter added: “If you have identified a need to switch cars, it is important to carefully consider your budget and stick to what is affordable, including if your circumstances change.
“Car finance terms can be confusing and knowing the difference between the options can seem a bit of a minefield at first. We always advise you to do your research online, over the phone or by speaking to an advisor in person.
Last month, industry experts spoke to Car Dealer about the possible effect of the cost of living crisis on used car prices.
Among them was Cap HPI’s director of valuations, Derren Martin, who appeared on Car Dealer Live to talk about it. You can watch the video of our interview with him at the top of this story.