Car insurance provider predicts decline in vehicle purchases

Tue, 20 Mar 2007

Motorists are not expecting to spend as much on a new motor as they did half a year ago, according to the findings of a new study from a car insurance company.

In a survey from car insurance provider Sainsbury's Bank, respondents collectively planned to spend £53.2 billion on a new vehicle between now and August 2007.

To put this into context, the previous six months saw people planning to spend £69.4 billion, the car insurance specialist points out.

Steven Bailie, loans manager at Sainsbury's Bank, speculated as to why people were anticipating shelling out 23 per cent less than last year.

"It is difficult to say exactly what is fuelling the decrease in anticipated spend on new cars and it could be a mixture of factors, including concerns about interest rates and environmental anxieties," he said.

Recently, it was revealed by financial services provider Alliance & Leicester Personal Loans that more than a quarter of motorists planning to buy a new motor intend to ask the dealership for financing offers.

Yet Richard Al-Dabbagh, senior loans manager at the company, urged people to take out a competitively-priced loan instead.

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