AA Financial Services, the personal finance operation of the automotive body, has said the proportion of those purchasing a car who would opt for dealer finance has fallen to 14%, down from 17% in 2012.

The AA Car Purchase Index, comprising an AA/Populus poll of 22,287 consumers in November 2012 and a survey of 17,883
AA members in December, has reported 52% of consumers would fund their next car purchase with money saved, up from a low of 39% in 2011.

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Those who would take a personal loan, such as that offered by AA Financial Services (see p10, Personal loan rates), have halved since 2009 to 10%.

The figures are at odds with results from the Finance & Leasing Association which has put the rolling figure of finance penetration at the forecourt for new car purchases at 71.6%

Other findings from the Index

  • Those aged between 18 and 24 are most likely to spend less than £1,000 (14% up from 5% last year). 35% of that age group will spend between £1,000 to £5,000
  • The number of people expecting to spend over £15,000 (23%) is the same as last year, but still markedly up on 2009 (16%)
  • Those aged 65 and over are most likely to spend over £10,000
  • Young women are twice as likely to benefit from a gift (4%) as men (2%) – this has been a consistent pattern over the past five years. Of 18-24 year olds, 16% expect to be either gifted their first car or lent or given money from relatives to buy one
  • The percentage choosing a hybrid car has remained constant over the past four years, but this year has risen from 3% to 5%
  • Those opting for an electric car continue to be very few with only 19 buyers in the survey saying this will be their choice
  • However, if in future prices came down and technology improved, a quarter (25%) of respondents said they would consider an electric car while half (50%) would consider a hybrid in the future

richard.brown@timetric.com

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