What Car? Insight weekly update – week ten

New car incentive decision is crucial, as 29% say they are delaying a new car purchase

This is the 10th in a series of weekly updates for industry colleagues from Rachael Prasher, managing director of What Car? and Haymarket Automotive.

The early indicators – website traffic, consumer behaviour, enquiries and anecdotal evidence – suggest a V-shaped bounce for June after the near flat-lining of the previous two months.

But will it last over the medium term? There are many reasons why it might not. However, according to our data, one major impediment to the industry’s recovery is an apparent lack of government action on a potential stimulus package.

Just like in 2009, France and Germany were the first governments to announce multi-billion-euro stimulus packages to boost sales. The UK soon followed. It had to.

Eleven years ago, that propped up sales after new car registrations had fallen to 30% of their levels from the previous year. We’re in a deeper dip – significantly deeper.

News of the incentive schemes on the Continent, and subsequent chatter among the industry and in the mainstream press, naturally leaks into the market – and potential car buyers are watching with interest, inevitably impacting sales activity.

Of course, any incentive needs debating and careful consideration, but what’s clear is that the time being used to do this is delaying purchases. Like you, I’m sure, I have seen 6 July mentioned as a possible day for the Government to reveal its plans. It can’t come soon enough; certainty one way or the other is looking increasingly important.

Alarmingly, our polling this week revealed that just over 29% of those people looking to buy their next car have chosen to delay in the hope of an incentive package along the lines of the scrappage scheme. While the initial bounce since dealerships opened has been welcome, it is clear that clarity here could significantly help to further unlock the market.

Customers are changing brands, spending plans and car types

The nearly 7000 respondents to our weekly consumer behaviour tracker highlighted the potential impact of activity from car manufacturers during lockdown.

A staggering 18.9% of buyers admitted they had changed their minds about what to buy during lockdown and are now looking at a different brand altogether. That doesn’t surprise me.

There was a great piece of analysis by veteran marketeer Peter Field after the 2008 crash. His statistical conclusion was simple: those brands that maintained their ‘share of voice’ enjoyed exponential sales success as spending returned. Those that didn’t, didn’t.

But it isn’t just brand choice that has been impacted. Nearly 10% of respondents admitted they are now looking at models with a lower specification than before and 25% have decided that smaller is better, so they will be downsizing.

And what of budget? Has that changed? Again, the answer is yes. But not just downwards.

For 15%, spending more than originally planned will be the order of the day. On the flipside, 10% have reassessed their finances and reduced their budgets.

The mood music from our audience of researchers is that manufacturers and retailers need to be more nimble-footed and accommodating to capitalise on changing customer perspectives than ever.

Customer impatience continues to build – as does interest in cleaner cars

The number of in-market buyers willing to wait no more than four weeks for a factory delivery has risen week on week. It now stands at 42%.

Furthermore, you could easily argue that this has had some – possibly significant – impact on the 31% of consumers who say they have decided to buy used rather than new since lockdown. This just hammers home the need for agile and quick thinking to avoid losing sales.

The final readjustment of consumer thinking that stands out this week relates to powertrains. For some, lockdown has prompted a reassessment of environmental priorities; 15% now admit they are now more likely to buy a hybrid, 8.2% a pure electric vehicle and a further 20.3% are investigating cleaner engines than before.

Landing the message of cleaner vehicles’ progress and their availability to buy is another positive avenue to explore.

A dramatic recovery to our own web traffic

The scale of the traffic recovery on whatcar.com last week following the reopening of dealerships caught even us by surprise – and if the website is to be considered a bellwether of new car buying intentions as a whole, that must surely be a positive for everyone in the industry.

Overall, page views ended the week up 40% week on week – and lest anyone think that is from a low base, the figure is also up 12% year on year and close to the levels we were enjoying at the end of February, when we were all rather more naive about coronavirus.

Notably, we also had a record week of traffic into our New Car Buying product, which has grown faster than all other areas of our website throughout lockdown.

Week-on-week traffic to the homepage for the product was up 62% – which led to around 300% more enquiries year on year and an increase of 600% in people interacting with dealers subsequent to that.

Of course, our product has been updated and improved during that time, as has awareness of it following our television campaign in the first three months of this year, but the levels of growth underline the surge in interest in the past seven days.

The most searched-for cars on whatcar.com this week

Honda’s fast-paced return to running a UK launch event reaped dividends last week, with the Jazz review garnering most interest over the past seven days, boosted by its presence in one of our daily email newsletters to our subscriber base.

Interest in the Volkswagen Golf – also driven in the UK for the first time two weeks ago – had propelled it to the top slot for two weeks, but ongoing interest has slipped in the past week.

Previous or reigning What Car? Car of the Year winners the Volvo XC40, Ford Puma and Kia e-Niro continue to do well.

Notable returnees to the list this week include the Jaguar E-Pace, which has been in and out of the fringes of the top 10 throughout lockdown, and the Tesla Model 3, which returns after – unusually – being pushed to 13th spot last week.

New Car Buying: now free to use until the end of September

We have extended our free offer to franchised dealers and OEMs to use our New Car Buying platform and lead management service until the end of September – with no tie-ins for new users, meaning there is no risk.

We recognise that our business can only thrive when retail is thriving again, and that is why we are offering leads from our in-market audience for free.

Current users include Ford Retail, JCT 600, Hendy Group, Marshall Motor Group, Snows, Vertu Motors, Vindis and Waylands Automotive.

If you’re interested in taking advantage, you can contact our support team on 020 8267 4138 or email us at support@whatcar.com.

Rachael Prasher
Managing director, What Car? and Haymarket Automotive