About the market:

While the number of private vehicles continues to grow, the proportion of used vehicles on the road is rising, with private new registrations falling significantly between 2004 and 2003. In addition, demographic trends are unequivocally adverse: an ageing population is less likely to need car finance overall and younger age groups are showing less interest in passing the driving test; younger people gravitating to urban areas would also lessen the demand for private cars. However, although economic factors suggest that consumers will draw in their horns over the next five years, short-term confidence seems to be rising.

Meanwhile, the weight of evidence suggests that generalised personal lending products have overtaken point of sale finance but the asset financiers have a number of factors and opportunities potentially in their favour. Nevertheless, the balance of distributive power lies with the retail finance industry rather than the motor industry. Use of the Internet is still in its infancy.

About the Mintel’s research:

Combining the most sought-after trend data and most authoritative, independent market analysis, Mintel’s new report offers you a vital new insight into the car insurance market.

In addition, the unique findings from exclusive consumer research enables you to tailor your offering to real consumer demand, helping you better understand potential customers’ attitudes car finance. Mintel’s research report has been designed to help you:

understand the current state of the domestic car finance market

learn about the major factors driving the market

analyse the market’s size and segmentation

track major market participants, product development, distribution and promotion

gain new insights into car finance in the context of consumer financial activity overall

learn from new findings into consumer behaviour and attitudes

get to grips with industry views

analyse and forecast future market development.

Intriguing findings include:

Some 70% of adults stated that they intended to save or invest, the same level as in the previous quarter and significantly higher than in June 2004 (62%). Consumers appear to be still intent on building up their savings levels, perhaps in anticipation of a slowdown in both the general economy (prompted by weaker consumer spending) and the housing market.

The finding that C1s are very nearly as likely as ABs to own a new car over two years-old bears out a finding in Mintel’s report Non-standard Lending – UK, Finance Intelligence, January 2005 that C1s are very willing to borrow to obtain upmarket vehicles.