Car Buying Trends Account for Budget Concerns

Of the many buys consumers regularly consider, cars represent some of the most expensive single-item purchases. Buying a car is a stressful proposition, which has lasting impacts on your cash flow. As a result, financial decision-making in respect to car deals is an important part of individual financial planning – keeping UK motorists on the road, without straining household budgets. And since cars are measured in many ways (performance, functionality, appearance, and price – to name a few), the selection and purchase process cannot be taken lightly.

A recent market report underscores some of the main considerations facing would-be car buyers. As you prepare to take this major financial step forward, use others’ experiences to help guide you on your way.

UK Motorists Reveal Thoughts on Car Buying

Although each would-be buyer operates under unique conditions, many residents looking for cars share similar concerns. Auto Trader, a leading car marketer, recently compiled a market report outlining some of the thoughts guiding modern car buyers. Not surprisingly, money matters ranked among consumers’ chief concerns.

Research Empowers Car Shoppers – The information age makes it easier than ever before to compare and contrast buying options across most consumer categories. For car buyers, online resources are particularly valuable for weeding through the myriad motoring choices. Not only do websites furnish general information about cars, but venders also use the Internet to market particular vehicles.

The Auto Trader survey points to an interesting trend among prospective car buyers, which indicates most shoppers underestimate the amount of time required to adequately vet possibilities. According to the study, buyers are each devoting around 11 hours to the preliminary process, using the time to compare options online. In fact, researching posed one of the most substantial obstacles for some respondents, who admitted their car-buying intentions were thwarted for months, as they sorted out details.

Car Buyers Relying Less on Negotiation to Land the Best Price – Haggling for a reasonable purchase price once served as the best path to a good deal, but modern shoppers are instead using vast resources to cement positive outcomes. Many survey respondents indicated they’d paid the asking price for recent car purchases, which represents an increase over last year’s responses. This trend can be partially explained by a well-informed customer base, acutely aware of the value and prevailing sale prices of individual car models. Savvy buyers are also using knowledge and information to get the best part-exchange pricing, turning to online valuation tools to ensure they are fairly compensated.

Price Tops List of Buyer Priorities – Buying decisions are influenced by several factors, but price appears atop the list of consumer concerns. And in practice, additional important considerations are also related to the financial impact of a car purchase. Fuel-efficiency, for example, ranked highly in the Auto Trader survey, reflecting an ancillary cost consideration influencing UK car-buying judgements. The following categories were rated by survey participants:

  • Price
  • Practicality
  • Fuel-Efficiency
  • Tax and Insurance
  • Reliability

Twenty-nine percent of respondents chose price as their top concern, with reliability identified by a close-second group of 23%. Fuel efficiency was most important to 21% of those ranking their concerns, while practicality and taxes/insurance closed out the top-five car-buying considerations – each garnering recognition from 14% of those surveyed.

Buyers Show Greatest Interest in Budget and Premium Cars – Another interesting takeaway put forth by the study’s organisers looks at the types of cars UK buyers are considering. According to the data gathered by the survey, the UK car market appears divided into two distinct segments. Competitive financing options, for example, seem to support a trend favoring premium cars. Over half of the car marketers’ advert viewing fell into this category, during the six month period leading up to the market report. At the same time, interest in middle-tier cars was less robust than has been seen at other points in the evolution of the UK car market. Still, 2015 saw a record number of new car registrations, topping 2.5 million during the year.

Myriad concerns influence UK car-buying choices, including several money-related angles. As you prepare to make financial commitments, model those who’ve plodded similar ground. Empower yourself to land the best price, for instance, by researching ahead of dealer visits and prioritising aspects of the process relative to your personal circumstances. With a clear direction in mind and supporting knowledge to draw from, you’ll stay on the road, without adding undue financial stress.

Paul graduated in 2001 with a degree in Finance. Since then he has gone on to work for several of the UK's most well-known financial institutions.

An avid blogger and a huge football fan, Paul is here to guide you through the ins and outs of personal finance and perhaps save you some money in the process!

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