As UK drivers enjoy a drop in fuel prices at the pumps, there’s been a subtle change to the nation’s car shopping habits. While monthly expenditure on fuel is falling, data from Motors.co.uk shows an increase in vehicle searches by monthly payment – with a 78% rise in searches by a monthly payment amount of £0-£300. And, with manufacturers offering countless deals for new cars within this price range, the reduced monthly spend on fuel is freeing up cash for consumers to upgrade their vehicle selection.
From November 2015 to February 2016, total searches by monthly payment increased by 97% against an overall rise in visits to Motors.co.uk of 61%. This is according to data from the Motors.co.uk Smart Search functionality, which enables shoppers to search for vehicles based on the lifestyle criteria that matters to them.
Peter Watts, director of dealer insight at Motors.co.uk, explains: “Over the past few months, we’ve seen fuel prices reach their lowest since 2009, with supermarkets slashing their prices to below £1 a litre. To put this into context, at its highest price point, we were paying over £1.42 a litre in April 2012 – that’s a saving of just over £25 for a 60 litre tank each time it’s filled up. Consumers are therefore making a significant saving each time they visit the pumps and, in some cases, this is freeing funds for spending elsewhere, such as on updating vehicles.
“This is good news for dealerships, with sales teams able to work closely with customers in order to present the most appropriate finance solution for their circumstances. In some cases, this may mean being able to reallocate the saved fuel costs to trade up a price bracket. Add in more fuel efficient models and the fuel cost reduction could be even more compelling.
“However, we must be mindful that the economic situation with regards to fuel is not a stable one and the drop in fuel prices is beginning to slow. Despite the Chancellor announcing a continued freeze in fuel duty in his recent budget, as oil prices steady slightly we could see an increase in fuel costs sooner rather than later. Dealers need to be quick to adapt and offer consumers advice on the finance and model options available to them and how this will impact their monthly and overall costs, regardless of the direction in which the economy may shift.”