Loans firm shows changing attitudes on car-buying

15/05/2009

People are buying cars because they have to - rather than because they want to.

This is the result of a new study from AA Personal Loans, which shows that motorists' priorities have changed radically with the stretching budgets caused by the recession.

The research showed that the most important reason for 44 per cent of those changing their car is to "replace an old or damaged vehicle".
This is the single most popular factor behind new car sales at the moment.

However, the AA showed that six months ago, before the recession officially began, the biggest reason for switching was to "save on running costs" - in other words, a question of choice rather than necessity.

The changing attitudes reflect a general decline in car sales, caused by the harsher financial conditions in the current downturn.

A government scheme to buoy new car sales by promising payments for scrapping an older vehicle was also welcomed by the AA.

Mark Huggins at AA Personal Loans added: "At a time when families are perhaps keeping cars longer, the new government scrappage scheme could be crucial to kick-start the industry and get people buying again."

Tags; Income Worries and Debt, Young Family Finances, Retirement Money Problems,

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