A third of Brits (32%) are planning to hold on to their current vehicle for longer than planned because of the cost-of-living crisis.
Research from Close Brothers Motor Finance found that 11% of drivers opted to buy a cheaper car.
Nearly all dealers (88%) believe that the cost of living crisis has influenced consumers to be more cautious about buying vehicles.
Two thirds of dealers (66%) said that their customers are buying cheaper vehicles, while 52% said they were cutting back on additional optional extras. A huge 69% said their customers were buying more second-and cars.
Lisa Watson, director of sales at Close Brothers Motor Finance, said: “As inflation continues to bite, it’s clear that drivers are having to think particularly carefully about big ticket purchases. It’s another challenge for the industry, after a tumultuous few years.
“For those looking to buy, it’s important to do your homework. Research the makes and models you’re considering buying, to make sure you’re getting the right price, specs, and add-ons. Work out what’s feasible in your budget, and talk to your dealer about which form of payment is the best for your financial circumstances.
“For dealers, data and insight has never been more important. By using the right tools, dealers can ensure they’ve got the right stock on their forecourts, at the right price, in order to meet changing customer needs head-on.”