Bye bye beamer: drivers downsize their cars as cost of living crisis bites

theguardian.com:

Drivers all over the UK are downsizing to cheaper, less prestigious and more fuel-efficient vehicles and banking the cash difference as the cost of living crisis continues.

BMWs and Audis are out – instead, dealerships report an increase in demand for used cars, particularly mid-range models such as Vauxhall Corsa, Volkswagen Golf and Ford Focus in the past two months. There has also been a drop in the number of people seeking to lease vehicles, with those who do so wanting cheaper deals.

The shift in driver behaviour is expected to continue as the reality of the current crisis deepens, says Lisa Watson of Close Brothers Motor Finance, which provides financing for vehicles. “We’re getting people coming from more expensive vehicles switching into more fuel-efficient ones … because clearly consumers are feeling the pinch,” she said.

“We have started seeing these changes over the last two to three months, and they are now becoming more apparent.”

She said that people were clearly growing increasingly nervous about the rising cost of energy. However, she expected that buyers would continue to fund their cars through finance deals such as hire purchase rather than shelling out large sums to buy a vehicle outright.

Vehicle leasing comparison sites have reported a fall in the number of inquiries for vehicles. Auto Lease Compare said the number of enquiries was down 17% on September last year. And LeaseLoco reported that 1,500 vehicles were sold through the platform in January but there had been a slowdown since consumer confidence dropped.

With disposable income now severely squeezed, motorists are looking to reduce their monthly car payments through cheaper lease deals, said LeaseLoco chief executive John Wilmot.

“There is a