Will COVID-19 have a positive impact on car sales post lockdown?
By Chris Penny, Franchise Brand Director
For those of you who were able to join our webinar this week (22nd April), you would have heard me discuss some of the key findings from our latest consumer research. Conducted just last week, four weeks into the COVID-19 lockdown, it was based on three separate surveys which collectively sourced the opinions of over 3,000 people. It’s a significant and valuable piece of analysis designed to highlight how consumer attitudes towards car buying and ownership have changed as a result of COVID-19.
For the automotive industry, it offers reassurance that despite the huge uncertainty and pressure retailers are currently facing, the market has every potential to return to health relatively soon after the current restrictions have been lifted. In fact, given how consumer attitudes towards public transport have been affected by the coronavirus - 48% of UK public transport users said they would be less likely to use it post lockdown - there’s a very real chance the market will experience an additional boost. This concept of ‘transport distancing’ – essentially not wanting to use a packed-out bus or train – was even more of a concern for younger commuters, with 66% of 18-24-year-olds claiming they’d be less likely to use it.
The research also found that more than half (56%) thought that owning a vehicle will be more important in the future. For those living in a city centre, and typically more dependent on public transport, this increased to 64%.
Of the 1,067 people asked about their current attitudes towards car ownership, nearly three quarters (74%) said that they are more concerned about having personal space following COVID-19, which is now beginning to shift their views on their personal modes of transport. Over half (56%) of UK driving license holders surveyed (1,059) who currently don’t own a vehicle said COVID-19 has made them consider purchasing a car when it’s safe to do so, which is great news for our industry.
Consumer demand on Auto Trader remains solid
Despite audience levels being lower during this lockdown period than normal, approximately down -30% year-on-year, we’re still seeing healthy interest for cars on our marketplace, with over 750,000 unique visits every day. This is also reflected in the research which suggests that a quarter (25%) of the consumers surveyed who are researching for their next car (1,051), are currently looking to purchase a vehicle now or as soon as they’re able to make a transaction. Whilst over half (57%) said that although they were still looking to buy, they will delay the actual purchase until later in the year. Perhaps most importantly, just 2% of consumers have decided not to purchase a vehicle as a result of COVID-19.
It’s not just a matter of wanting to buy a car either. The research suggests people will be able to afford to do so. Despite the current economic climate and the uncertainty facing many, confidence in vehicle affordability remains high – just 16% feeling apprehensive about how they’d fund a vehicle purchase before the end of June 2020.
So, what does all this mean for the automotive industry? Well, for one, it highlights that COVID-19 is having a profound impact on consumer attitudes towards transport that will last beyond the national lockdown. Importantly for retailers, it points to a market that has been paused, rather than stopped – it will resume again. And with so many consumers put off using public transport, there’s a chance that when it does it will be in better shape than it has been for some time. It reinforces what we’ve been saying on our weekly webinars – your dealership may be closed, but it is essential that your digital forecourt remains open and visible to the thousands of car buyers who are looking for their next car. By doing so, you and your business will be in the very best position to take advantage when we return to the new normal.
During our next webinar, on the 29th April, I’ll be revealing how changing consumer attitudes will force significant changes in the way in which retailers will sell their cars post lockdown.
You can register here: https://trade.autotrader.co.uk/events/