Brits spend £90 billion a year on running their cars
Direct Line launches Driving for Less
· New report from Direct Line Driving for Less reveals that the average cost of running a new car is now £511 a month
· A staggering one in four new car buyers accept the finance offered by the dealer, costing themselves an average £1735 in the process
· Direct Line launches Driving for Less - a unique three-in-one car finance package with its lowest ever loan rate of just 5.6% APR typical
A new report from Direct Line Loans to launch its new, innovative Driving For Less package, reveals that the cost of motoring in the UK has risen by 56% over the past 20 years, way ahead of increases in the average household income.
The Direct Line Driving For Less Report highlighted that owning and running a brand new car has now outstripped all other areas of household expense – and at £511 per month*, is just £68 lower per month than the cost of an average mortgage.
Yet Brits are still committed to their cars with more than three- quarters (78%)** of us owning a car, and as a nation, spending in excess of £90 billion*** per annum running and maintaining them.
Some 400,000 people are expected to buy a new car this March**** as they race to the showroom for the arrival of the latest 06 registrations. Direct Line has launched its fantastic car finance package, Driving For Less, to save customers who are buying new or used cars or for those refinancing their existing car deal, both money and time, in terms of one call.
The Driving For Less package incorporates Direct Line’s lowest ever loan rate of 5.6% APR typical for loans from £5000 - £25,000; 10% discount on Direct Line’s best car insurance deal in year one and 5% in year two and free emergency breakdown cover for two years, worth at least £72 over the period.
While drivers cannot avoid many of the costs of running a car, such as road tax and depreciation, the Driving For Less Report has highlighted that people could be spending more than they need to when it comes to making that initial investment.
One in four (25%) will sign up to the dealer’s finance deal, costing themselves an average £1735***** in the process. The average APR finance deal from car dealers is 9% - 3.4% higher than the cost of the Direct Line Driving For Less loan.
David Allan, Commercial Director for Direct Line Driving for Less comments:
“The most concerning aspect of the report is that of new car buyers this March, one in four will accept the often expensive car dealership’s financing schemes. We have created Driving For Less to incorporate the key financial costs of running a car – the finance package, the insurance deal and the breakdown cover – and combined them to offer a fantastic value-for-money package.
“We would encourage car buyers to check out our Driving For Less package BEFORE heading out to look for their new car, whether that’s a brand new car or a used vehicle. That way, you’ll have an indication of what your loan payment is going to cost you each month, what the cost of insurance might be and you’ll have the security of knowing you have free breakdown cover for two years. That way you can rest easy when you make your purchase, because you know you have got a superb value deal.”
Key features of Driving for Less
· Loan rate of typical 5.6% APR Typical. Loan rate of 5.6% APR for loans between £5,000 and £25,000. For loans of £2,000 - £4,999 loan rate is 13.9% APR
· 10% off car insurance for year one and 5% off year two
· Free breakdown cover for two years worth at least £72 over the period.
For more information, log on to www.directline.com
- ends -
Jill Coyle jill.coyle@directline.com or 0141 308 4295
Editor’s Notes
* The Direct Line Driving For Less Report was compiled between 30th January and 3rd February 2006 by Business Development Research Consultants (BDRC) looking at the most popular make of cars. They analysed the cost of buying and running a new car over a three year period, looking at two cars from each sector of the market. Areas taken into consideration were finance required; cost of finance (dealer); cost of finance (high street); cost of finance (internet); value after three years; depreciation; road tax; fuel costs; servicing; repairs; Other Equipment Manufacturer tyres and washing of the car.
** Research carried out on 2253 people between 27th and 30th January 2006 by You Gov on behalf of Direct Line Driving For Less.
*** UK population of over 18’s = 42m / by the number of car owners = 34.3m, £222 spent a month on cars x 12 = £2664. £2664 x 34.3m = £91.4bn
****Estimated 400,000 people bought a new car in March 2005 – Society of Motor Manufacturers and Traders Ltd.
*****Average %APR and average additional cost of car dealer’s finance deals calculated by BDRC by taking the standard APR offered by the UK’s ten most popular (by car sales) car finance deals and then calculating the average.
Direct Line Living For Less loans current APR is 5.6% typical (fixed) on both the phone and the internet www.directline.com. Loans from £5,000- £25,000 have a current APR of 5.6% (fixed). Loan amounts of £2,000 - £4,999 have a current APR of 13.9% (fixed). Repayment terms from 24 to 84 months (depending on loan amount) are available. Loans are available to over 22s only in Scotland, England and Wales. Calls may be recorded.
Direct Line won the Moneyfacts Personal Loan Provider of the Year award for 2005.
Direct Line’s free breakdown cover provides roadside assistance and up to one hour’s free labour. If the car can’t be fixed at the roadside, Direct Line will transport it to a suitable garage nearby. There are no call-out charges and the customer is covered as long as the car is at least one mile from the customer’s home.
|
