A recent study has found that UK consumers tend to own a particular car for considerably shorter time periods than in the past. In fact, it’s been found that they would sooner change their vehicle than their mobile phone.
This is according to automotive data analysts CAP HPI, who found that some car manufacturers are now seeing vehicles returned in an average of two years, with evidence of shorter 18-month leases growing in popularity. CAP HPI adds that the average phone contract currently lasts between 18-24 months.
The ‘iPhonification’ of the car industry
A retail and consumer specialist at CAP HPI, Philip Nothard, said: “What we are seeing is the ‘iPhonification’ of the car industry as consumers increasingly pay to drive rather than pay to own their vehicles.
“It’s the same model as the mobile phone industry where people are comfortable paying a monthly fee – only they are now doing this with their vehicles as well as their mobiles.”
Finance options that are increasingly growing in popularity, such as personal contract purchase (PCP) and personal contract hire (PCH), are seen as playing a large part in changing consumer habits. CAP HPI estimates that about 80 per cent of new car sales are on finance.
Nothard added: “Consumer demand remains strong in the used car market and there are lots of used bargains waiting to be snapped up. As PCP becomes more popular and accessible in the used market, motor dealers expect its use to double in the future, so we’re going to see people changing their cars with increasing regularity.”
