The cost of living crisis is driving car buyers away from online purchases and into dealerships – with many expecting to bag a better deal by meeting the retailer in person, new research shows.
April’s Startline Used Car Tracker reports that 55% of people have become less likely to buy a car online because of pressure on personal finances with 31% preferring to view the vehicle in person and 17% intending to negotiate.
Also, 13% want to view the dealer’s premises and 12% are looking to discuss the finance options offered.
Paul Burgess, CEO at Startline Motor Finance, said: “People are being much more careful with their money, especially when it comes to major purchases such as cars, and it makes sense that they want to take a good look at the car they are buying, as well as the dealer and the people they are buying from.
“It’s also probably a result of the fact that the average used car has been getting both older and more expensive since the pandemic thanks to stock shortages, meaning potential buyers are more likely to take time looking at a vehicle to make sure that it is a sound purchase.
“Additionally, it’s interesting that almost one in five also believe that they’ll get a better deal by turning up and negotiating in person as well as wanting to talk to someone about their financial needs. It all underlines that a majority of people still want to deal with another human at some point during the car buying process rather than do everything online.”
However, 45% are happy about buying their car online, the Startline Used Car Tracker additionally shows, with 35% saying they believe they’ll get a better deal, 25% being confident about buying remotely and 10% wanting to have the vehicle delivered to them.
Burgess said: “Many dealers – and not just large ones but some relatively small, local garages – now have very sophisticated online car buying processes that might include factors such as live video walkarounds of the vehicle, the ability to make a part exchange, and a range of tools to sort out your finance.
“For people who are happy to buy online, the experience is likely to be a good one, despite the cost of living crisis.
“Also, of course, during the last few years, we’ve seen large digital disruptors enter the used car market and compete against traditional dealers. They’ve had varying degrees of success but have arguably helped to popularise the idea of buying a used car on your phone or laptop. The research shows that a large minority of people are receptive to the idea.”
Understanding financial inclusion can provide insights into issues related to economic development, which can impact the overall health of the economy and the ability of car buyers to make informed purchasing decisions.