• 83% of customers said that the monthly repayment cost is the most essential part of their used car decision-making process
  • A total monthly budget of £151 - £250 is the most common set by consumers (48% of total)

This is what 2,479 used car finance customers told us in recent research.

As the crucial used car buying Millennial and Generation Z generations face up to rising inflation and successive Bank of England base rate increases, which most will never have experienced in their adult lives, the significance of customers' monthly budgets and affordability is set to escalate.

Inflation is now at a thirty year high of 5.5% (CPIH), according to the latest figures from the Office for National Statistics (ONS). Worryingly, the Office for Budget Responsibility has predicted UK inflation is now set to average 7.4% this year.

Bank of England has warned it could rise above 7% this year. Rising petrol/diesel costs and increasing used car price rises feature prominently in the primary drivers of inflation.

Faced with a squeeze on their cost of living, monthly budgeting, which has always featured prominently in consumers' car buying decision-making processes, is likely to have an extra area of focus.

Managing Director, Karl Werner, reflects that dealers can help car buyers by ensuring peoples' budgets are at the heart of their thinking, noting,

"Dealers should not underestimate the impact of the cost of living increases we see and that look set to continue. They can help themselves by building this thinking into their marketing, one-to-one communication and stock buying.

Dealers may wish to consider the potential for utilising budgetary range insights from their customers' previous purchases and running cost information into their stock buying in a timely twist on the 'buy right to sell right' mantra."