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Demand for second-hand cars falls

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With the Government's "cash for bangers" scheme encouraging more people to buy a new car, research shows fewer motorists are planning to buy second-hand vehicles.

According to a survey by Sainsbury's Finance, only some 8% of adults intend to purchase a used car over the period September 2009 to February 2010.

This is in comparison with just under 10% who planned a similar car purchase in the period of March-August 2009.

In the six months to February 2010, the average amount that consumers looking for second-hand vehicles plan to spend has decreased by 2% from March-August 2009 to £5,323.

The survey further showed that at 15%, Scotland had the highest proportion of adults planning to buy a second-hand car over the next few months, followed by the East Midlands with 13%.

Meanwhile, the percentage was lowest in north-east England (4%) and north-west England (3%).

Steven Baillie, head of Sainsbury's Loans, said: "Our research suggests that less people intend to buy a second-hand car in the coming months, which may be partly due to the Government's car scrappage scheme encouraging more people to buy a new car instead.

"Indeed, we estimate that the scrappage scheme is directly responsible for a 37% increase in the value of personal loans taken out to purchase cars since its introduction. It can of course be significantly cheaper to buy a second-hand car, but buyers and sellers could save even more money if they do their homework."

© Press Association 2009