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Britons 'to buy more cars in 2007'

The number of people planning to buy a new car is set to leap by 20 per cent in 2007, new research reveals.



A survey from AA Personal Loans found that a quarter of people plan to purchase a new motor this year, up from one in five people in 2006. Using personal loans is a popular way to finance a new car purchase and many consumers are likely to use this method to do so in 2007.

And despite the fact that it now costs as much as £5,500 per year to keep a car on the road, the survey revealed a growth in demand for new and nearly-new vehicles, but a fall in demand for cars over three years old from 28 per cent in 2006 to 22 per cent in 2007.

People are also planning to spend more on their new cars, with the average consumer banking on paying £10,136 in 2007, compared to £9,342 in 2006.

However, the organisation warned that some drivers may not be considering the right things when choosing their new vehicle.

Director of AA Personal Loans Lloyd East advised: "A modern car will last up to 20 years and when you consider most cars lose up to a third of their value as soon as they leave the showroom, perhaps more should be thinking more carefully about the investment they're making when buying a new car, ensuring the get as much car for their money as possible."

Car buyers 'turning green'

It looks as though green is the colour of the season for car buyers in the UK, with a growing number of motorists getting environmental when it comes to new car purchase.

A report from the AA reveals that a rising number of car owners are selecting their cars based on environmental factors, as they are looking to reduce their carbon footprints and boost their green credentials.

On the other hand the popularity of flashy, sporty numbers is on the decline, suggesting that common sense and eco-friendly motoring is the latest trend in the world of driving.

According to the AA, the number of people buying cars for environmental reasons has increased from six per cent to 20 per cent over the last year alone while demand for sporty cars has fallen to six per cent.

"With a fifth of all car buyers today going green, the environmental agenda is being driven into the heart of the motor industry," Lloyd East of AA Personal Loans commented.

Popular green cars include the Toyota Prius electric-petrol hybrid, which is exempt from congestion charge payments in the capital.

Car buying plans see first drop for two years

More than a quarter (26 per cent) of those who plan to buy a car in the next six months will fund their purchase using a personal loan, new figures show.

However, the number of Britons who are planning to buy a car has dropped for the first time in two years, research from Sainsbury's Bank reveals, with 7.65 million people planning to do so between March and August 2007, a decrease of 430,000 people from the previous six months.

The amount that people are planning to spend has also fallen, with £53.2 billion expected to be spent in the next six months, £16.2 billion less than during the period before that.

Sainsbury's Bank said that the fall was the biggest one that the index had seen to date and could be down to a mixture of factors, including environmental worries and concerns about interest rates.

Around 15.8 per cent of the expected spend on cars will be funded through personal loans, which adds up to £8.41 billion, said Steven Baillie, loans manager at Sainsbury's Bank.

"Although this represents a 33 per cent drop in the total planned for car purchase loans, it's actually more important than ever for people to shop around due to heightened competition in the market," he explained.

Figures from the Society of Motor Manufacturers and Traders revealed that new car registrations fell 2,410 units in February to 73,586.

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