Close Brothers Motor Finance’s latest research indicates that more than half of drivers planning to buy a car this year, with a notable lean towards hybrid vehicles.
The study reveals that approximately one in four, or 28%, of potential buyers are considering a hybrid for their next vehicle.
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Petrol vehicles remain a choice for 31% of drivers, while diesel’s popularity continues to decline, with only 11% of drivers opting for it.
The UK Government’s decision to postpone the ban on new petrol and diesel cars from 2030 to 2035 has had a mixed impact.
Although only 12% of drivers currently expect to purchase an electric vehicle (EV), down from 14% the previous year, nearly half (47%) appreciate the extended timeframe to transition to alternative fuel vehicles (AFVs).
Confusion persists among consumers regarding the best fuel type to choose, with 14% unsure of what to purchase.
This uncertainty is compounded by the fact that 42% of the respondents feel more confused than ever, and 41% are concerned about making the incorrect choice amidst the evolving automotive landscape.
When it comes to the type of vehicle to purchase, there is a split between new and used cars.
One in five (20%) drivers plan to invest in a brand-new car while a slightly lower number (18%) will opt for a used or second-hand vehicle.
Six out of ten drivers (58%) think there is a good selection of high-quality used cars available on the market.
Close Brothers Motor Finance director of sales Lisa Watson said: “There is certainly a desire to switch to electric, but with the current economic climate and financial pressures faced by many UK households, it’s likely that costs are prohibiting more widespread EV adoption in the UK. Coupled with concerns about infrastructure many are opting for hybrid – a segway from leaping from fully petrol to fully electric.
“Although the UK recently hit a milestone of the one-millionth EV being registered, the statistics remain skewed by fleet sales, and demand is not where it needs to be if the 2035 ban is to be realistic. More will need to be done to encourage drivers to make the switch.
“And it is not just drivers who remain cautious, currently just one in five (21%) dealers believe the ban will actually go ahead. As drivers look to make new vehicle purchases this year, it’s vital that dealers ensure they’re stocking the right stock to meet the demand.”
This research emerges as the Financial Conduct Authority (FCA) continues its review of historical motor finance commission arrangements.
In a related move, Close Brothers Group has decided against paying dividends on ordinary shares for the current financial year.
