Almost two thirds of Brits said buying a car was difficult, with 61% of people citing finance as one of the most challenging aspects. Simplifying the financial process for consumers could lead to an influx of £9.6bn into the United Kingdom’s automotive industry.
The scale of the opportunity for manufacturers is sizeable. There were 2.47 million car sales registered in the UK in 2014, and in 2015 to date 46.3 per cent of these have been private sales to consumers with an average price tag of £27,219. The total amount currently spent, assuming these figures remain consistent, is £31 billion. However, making it easier to buy cars could almost double how often people do it, from the current average of 6.3 years to 3.5 years, and 39 per cent said they would change their car more often if car finance were easier to manage. Therefore making car finance easier to manage could grow private car sales by £9.6 billion to £40.7 billion.
A majority of Brits polled (63%), said they don’t trust their dealership with their car finances and that they would rather purchase and finance a car directly from a manufacturer. 39% of Brits said they would change their car more often if the financing was easier to manage. Car finance companies typically engage with customers by sending out an annual statement, when consumers would prefer a digital solution.
David Webber, managing director of Intelligent Environments, said: "Our study reveals the scale of the opportunity automotive manufacturers are missing out on. Simpler car finance can help the UK car industry make an additional £9.6bn. Not only that, but our figures show that current car finance practices are actively holding people back from purchasing more cars, and half say they want a closer relationship with the provider of their car finance and the manufacturer.
"There’s a great opportunity here. Currently, manufacturers’ relationship with their customers ends at the point when the car is purchased, as they then hand over the customer relationship to the local dealership. By providing the financial management directly, manufacturers can extend their relationship with customers across the entire length of ownership. As cars become smarter, more complex and increasingly sophisticated, a closer, better and simpler relationship with the manufacturer will become increasingly important to consumers. This technology will help take the first step."