More readily-available car finance has enabled a steady flow of ‘nearly new’ cars into the used car market, improving the range and value available to customers.
This is according to research from AA Cars, which found that UK consumers are three times more likely to purchase a used car than a new car.
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The survey of more than 15,000 drivers found 29% had purchased a ‘nearly new’ car most recently, compared with 26% who opted for a brand new car. A further 25% of car-buyers purchased a vehicle more than five years old.
Nearly new cars – defined as those less than three years old – have seen a swell in availability due to a large number of vehicles that were leased or bought on finance when new. The research found these were the most popular vehicles among car-buyers.
The survey confirmed young people are predominantly buying older – and therefore often less expensive – vehicles. Of those surveyed, 59% of 18-24 year olds said their most recent purchase was of a used car more than five years old. Almost a quarter (24%) of those in this age group had bought a used car between three and five years old, with just 7% buying a nearly new vehicle and 6% opting for a brand new one.
Scottish and Northern Irish drivers were most likely to be driving a car bought new, with 30% of drivers in each region doing so. They were followed by the 28% of motorists in the South East of England and the 27% in the North East who opted for a brand new car. The lowest proportion of new car sales was seen in the East Midlands, where 23% of drivers bought their current vehicle new.
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By GlobalData“The growing popularity of car finance is changing the shape of the car market as a whole,” said James Fairclough, chief executive of AA Cars.
“Car finance was first conceived as a way to help people drive a new car they could not afford to buy outright, and in this respect it has been a huge success – enabling tens of thousands of motorists to spread the cost of a new car over time.
“But it has also provided a steady flow of ‘nearly new’ vehicles into the used car market. This surge in supply has improved the value and range available to used car buyers – and allowed them to snap up low-mileage, well-maintained vehicles at prices that would have been unthinkable until recently.
“As a result, motorists now have more choice than ever – both among the huge range of cars available on the second hand market, but also the various financing schemes open to them,” concluded Fairclough.
