Car sales set to plummet, Sainsbury’s warns

The number of people planning to buy a car in the next six months is at its lowest level since 2003, Sainsbury’s Finance revealed this week.

According to the supermarket bank’s Car Buying Index, 5.1 million people are planning to buy a car in the next six months.

This is down by 1.2 million people compared to the 6.3 million who said they planned to buy a car six months ago.

The figure is 2.9 million below the Index’s peak in September 2006.

The amount consumers intend to spend on cars has also dropped to the lowest level since records began in 2003, falling to £39 billion.

“Our latest car buying index, which has been running now for seven years, reveals an all-time low in both the number of people who intend to buy a car and also in the amount of money they are intending to spend,” said Steven Baillie, head of loans at Sainsbury’s Finance.

“For the first time since launching the index, we see the anticipated spend on new cars over the next half-year drop to under £40 billion.”

However, Baillie remains optimistic that demand for cars will improve.

“The car industry is beginning to report a growing demand for second-hand cars in particular,” he said.

“This demand seems to in turn have led to an increase in the value of second-hand cars so many people could be pleasantly surprised at how much they might get for their current vehicle when they come to upgrade it for a newer version.”

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