Almost three quarters (74%) of consumers intend to fund their next car purchase using dealer finance, a survey conducted by independent lender MotoNovo finance has found.
A further 18% said they were ‘not sure’ or would see their options at the time. Just 8% said they intended to pay for their next car in cash, and none selected ‘loan.’
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When asked why they would choose dealer finance, half (50%) said it was because of competitive and transparent pricing. Almost a quarter (24%) said it was because the dealer offered it.
Of the remaining options, 10% said the selected it due to availability, 8% said it was due to convenience, while just 2% said it was because they were offered a better deal than elsewhere. The remainder based their choice off previous experience or didn’t recall.
MotoNovo also noted that customers often only discovered how competitive dealer finance could be once in the show room, and therefore advised promoting rates online.
Karl Werner, head of sales and marketing at MotoNovo said: "dealers should be encouraged by these findings because they clearly demonstrate that customers who opt for dealer finance clearly love the experience. The opportunity that these findings reveal is twofold:
– Finance can help retention
– Dealers can make in-roads to increase finance penetration by increasing their promotion of finance in a transparent fashion focusing up competitive pricing. This message can be supported by information about availability and convenience.
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By GlobalData"We know that many dealers are concerned about the implication of FCA regulation. Our message is that this change could in fact be a catalyst for growth."
