Car manufacturers exist to constantly sell newer cars, and on average we keep our cars for roughly 4 years before passing it on. This doesn’t stop some people from keeping their cars for its entire lifetime though. So why do some of us keep our cars for so long?
What makes us hold onto our cars longer before buying a newer one?
First off, the amount of information available has changed the mindset of the consumer. We’re more informed than ever before about what makes a good vehicle – emissions, engine capabilities, fuel economy and resale value are all factors.
With the world at our fingertips, you can learn how to become a mechanic or weigh up the market’s strengths at the push of a button. The industry is no longer entirely in control.
Primarily, we hold on to our cars for longer because they become an extension of who we are as people. Vehicles become our space, an expression of who you are and let’s face it – we all get sentimental!
What’s more, holding on to your hard-earned cash has never felt more vital than today. With our ever-changing economy, we’ve all learned to be more careful with our spending habits.
What financial factors make people drive their cars for longer?
Quite simply, the most critical factor that affects how long we drive our cars for is income. If upgrading your vehicle costs you more than you can afford, you’re going to hold on to your current vehicle for longer.
Knowing how much to budget for in light of rent, mortgages and day to day living can massively impact our spending. If you are considering finance, you are going to want to keep your monthly outgoings to a minimum. On that basis, the experts recommend a 20% down payment of the vehicle’s cost.
Some people will hold on to their vehicle for longer purely out of fear. Credit scores are often misinterpreted and put potential consumers off. Knowing the difference between a soft search and a hard search is vital. When you are just enquiring about a quote, a soft search simply matches you to your credit record. It’s only when you commit to a quote, a hard search is performed, and that is when it appears on your credit score.
Where you live can also affect how long you drive your car for. If you are in a low-income area, having a flashy car is going to set you apart. Equally, owning an older vehicle may make you feel sidelined in a higher-income neighbourhood.
Socio-economic factors have more of an effect on how we think about our status than we realise. What your car looks like, feeds into that too.
Auto trends also dictate how important it is to replace your vehicle. For instance, if you are living in a low-emission focussed community, such as Central London there is more pressure for you to buy a newer vehicle.
What if I’m considering a change?
Selling your car at the right time can be the making or breaking of your future investment. As the world begins to repair itself in the wake of a pandemic, drivers will have to weigh up their options:
- Am I going to save money by investing in a newer car model?
- Can I get a reasonable resale value on my current vehicle?
- Is finance an option for me?
- Can I afford a new car with or without finance?
In the light of a global strain on manufacturing and the economy, it would be reasonable to assume that car sales will slow down in the interim. However, given the rise of concerns for the environment and lowering emissions, sales may increase in light of keeping enforced daily fees down.
So should I get rid of my car?
Lowering emissions and protecting the environment is hugely topical at the moment. With the UK government rolling out schemes such as London’s ULEZ (Ultra Low Emission Zone), drivers have to reevaluate their vehicles. Drivers have to either pay a daily charge or invest in a zero or low emission vehicle.
Arguably, the motoring industry is having to be more innovative and creative than ever before. They need to create low-emission vehicles that the average wage can afford while facing a challenging economy. Let’s be honest; they haven’t quite cracked it yet! So improving your vehicle instead is certainly worth thinking about.
But, you also have to consider car depreciation in the face of the economy. If it comes down to your vehicle’s market value, and how much it’s worth now – is it potentially worth switching to a newer car?
In the end, it’s completely up to you and your circumstances. If a newer car would make your life easier, then go for it. If not, then have a think before you commit one way or the other.