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Catch up with the latest press releases from LV=

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Second Hand Cars

Press release: 03/02/2009

One in Five Motorists Downsize Leading to Millions in Savings

  • One in five drivers (19%) has downsized or sold a car since the onset of the credit crunch, adding up to a total of £4 million estimated savings in the UK

  • Six out of ten drivers (61%) said they downsized because of concerns about the rising cost of fuel

  • Nearly a third (29%) downsized to get cheaper insurance premiums

  • Two in five drivers (43%) who are planning to buy another car in the next 12 months are intending to buy second-hand

  • Two-thirds (66%) of these say they can't afford to buy a brand new car because of the current economic climate

Research from car insurer LV= has revealed that almost one in five drivers (19%) has downsized or sold one of their cars since the onset of the credit crunch, in a bid to save money.

The main reason given by motorists for downsizing their vehicle over the last eighteen months was to save money on fuel (61%). Nearly a third (29%) said they did it to reduce insurance premiums and the same number said they wanted to cut the cost of road tax (29%).

On average, those one in five drivers who have downsized their car estimate they have already saved an average of £309.

Despite the emphasis from the Government on ‘greener' driving, only one in six (15%) of those who had downsized cited environmental concerns as part of their decision.

With more UK motorists downsizing, or buying second hand instead of new cars, the effect on new car sales has been catastrophic. Sales of new cars have fallen by a third over the last year, with 600 fewer vehicles a week being registered in November 2008 compared with 12 months before. As a result, car production has slumped by a third over the last year and the Government is now considering extending state aid to the troubled motor industry.

Almost a quarter (23%) of respondents to the LV= survey said they would consider buying a second hand car to reduce their insurance premiums. LV= analysts recommend taking the following additional points into consideration when buying a second hand car, to help reduce insurance costs:

  • Look for a common make of car, they are generally cheaper to repair if you are involved in an accident.

  • Buy a car with a smaller engine, as generally that will mean cheaper insurance.

  • Don't buy a vehicle that has had the engine or bodywork modified, as that could cost more to insure.

  • Don't buy an imported vehicle as they can cost more to insure.

Also, to ensure you have the best value insurance, take the following steps:

  • Shop around for insurance and don't just renew with your existing provider – the market is very competitive and you could make big savings.

  • If you keep your car garaged at night, tell your insurer as this could reduce your premium.

  • If your annual mileage is low, tell your insurer as this could mean a cheaper premium.

  • Make sure you have the right class of cover and are not paying for business or commuting use if you do not use your car for work.

John O'Roarke, Managing Director of LV= Car Insurance, said: "Buying a car is often the second biggest purchase people make after their house so it's only natural that in the current economic downturn, when people are being more careful with their money, they also look to save on their motoring costs.

"This is undoubtedly a smart move, as the credit crunch looks set to bite deeper. By following the guidelines above, motorists downsizing should be able make significant savings every year without having to consider getting rid of their car altogether."



Opinium Research carried out a survey of 1,954 people between 12 and 16 December 2008.

* Average saved on downsizing multiplied by 13% of drivers who downsized their car = £4,061,904
** Total adults in the UK = 48 million (source: Opinium Research). 18% of private drivers (private drivers are 76% of all adults) = 6,394,000
*** Statistics from the SMMT on November car sales and production figures


About LV=

  • LV= offers car, home, travel and pet insurance direct to consumers by telephone from its UK call centres in Bournemouth and Croydon and online from its website: www.lv.com

  • LV= insures over 1.6 million cars and 480,000 households in the UK.

  • LV= has been awarded the Defaqto five star rating for home insurance and car insurance.

LV=

  • LV= is a trademark of Liverpool Victoria Friendly Society Limited (LVFS) and LV= is a trading style of the Liverpool Victoria group of companies. The new LV= brand identity was launched in March 2007.

  • LV= employs more than 3,700 people, serves more than 3.6 million customers and members, and manages around £7 billion on their behalf. We are also the UK's largest friendly society (Association of Friendly Societies Year Book 2006/2007, Total Net Assets) and a leading mutual financial services provider.