The changing nature of car purchasing
By Steve Thornton; Forces Cars Direct & Motor Source Group
Wednesday, September 12, 2018 - 08:58
If I’d said ten years ago that one day you could be buying a car with as little as a single trip to the dealership – possibly even without seeing it at all – chances are you’d have laughed in my face. But I can tell you – as someone who sells cars for a living – that the way people go about buying a car has changed beyond what anyone could have imagined even a few years back. Even if you wouldn’t personally buy a car without seeing it, you can at least imagine how you’d go about it: which websites you’d go to, which statistics you’d want to compare, and you’d have some idea where you’d go to get a good deal. This is a world away from how we used to buy cars. And looking at some of the changes that lie ahead in car manufacture, I think the way people buy cars stands to change again, perhaps even more than we’ve already seen. New technology, both vehicle engineering and tech in other areas of people’s lives, is the main thing that has transformed both cars and the way we buy them, and that shows no signs of slowing down any time soon.
We often say in the trade that buying a car is becoming more and more like buying a mobile phone. What we mean by that is that customers are getting used to having a new car once every few years – “new” meaning in this case both one they themselves haven’t owned before and reasonably up to date model. People are moving away from buying a car for life to run into the ground. This is the same as with mobile phones: we all have the odd friend who goes along happily using their old Nokia brick, but the vast majority of us don’t remember what it was like not to have a reasonably up to date phone to help us stay on top of things. And it’s noticeable that customers have got used to having the latest technology at their fingertips, whether that’s as they make a call or whether they’re behind the wheel of their car.
One thing that has made this possible is the introduction and uptake of Personal Contract Purchase plans – or PCP. In short, PCP allows you to make monthly payments towards part of the cost of a car, as you do to the monthly cost of your mobile phone. It’s different from your phone plan, however, as many people end up overpaying the cost of the phone on these plans. One of the best things about PCP is that you’re not tied to buy the full cost of the car at the end of the contract. While it’s not for everyone, many of our customers find the monthly instalments a manageable way to pay for their car, without having to commit to paying the full cost of the vehicle, as they would have to with a hire purchase deal. Any saving they make at the end of the contract they can pay forward into a new PCP for a new car. As they’re also not having to shell out on the full cost of a car, this means they have more capital to pay forward towards their next car. And with technology advancing at the rate it is, the temptation to splash out on something new gets higher every time!
What’s also changing is the technology, and with it the sheer amount of information, easily available to customers wanting to choose a new car. Thousands of websites exist where customers can find out almost anything they want to know about any car – from engine capacity to passenger legroom – and compare models in as much detail as they wish to. You can read countless reviews on any model of car you’d like to know about, without tying yourself in the slightest to buying it. In theory, it would be entirely possible for a customer to have made up their mind before they even cross the door of the showroom – and it’s movement towards this way of buying cars that we’re seeing in practice too. As our cars are getting smarter so are our customers. By the time they come to talk to us, they know their own mind much better than they did in the past.
Having said that, it’s entirely possible that the greatest changes that we will see in the motor industry are still to come. It can’t be too long before technology currently in its development phases hits the market. Driverless and electrified cars will transform the experience of driving (if that will even be the right word any more once the car is in charge of its own movements) and no doubt also the way we will want to buy them. As these technologies advance, it will become standard for a new model to be launched on a yearly basis to keep up with these developments. Year on year, cars will also become more efficient and better for the environment. Again, ten years ago you’d have struggled to credit that an electric car could perform the way today’s do in such a short space of time – the advances in battery tech and charging capabilities have been truly incredible. In our lifetime’s we should expect to be able to hail a lift remotely and be picked up by a driverless car, and how we will pay for that remains to be decided, though I would suggest that it might look something a monthly subscription service. Even more so than we’ve seen to date, I expect car buying will move towards ultimate convenience for the car user, in terms of availability, payment and vehicle specifications.