The cost-of-living crisis is forcing families to sell their cars.

Thats the conclusion of research by Startline Motor Finance’s October Used Car Tracker.

Almost one-in-four (23%) said they already or are going to reduce the number of cars in their family. Meanwhile, 61% said that tightening personal finances have changed their attitudes to car ownership for the worse.

Smaller and cheaper

The report also found that 59% were looking to switch to cheaper to run, while almost a third (29%) would buy a car with a smaller engine and 21% simply a smaller car.

Motorists also appear to be turning away from petrol and diesel due to the cost-of-living crisis. Instead, 19% say they would look next for a hybrid car and 15% electric.

Paul Burgess, chief executive officer at Startline Motor Finance, said: “There’s probably more than one trend happening here. The first is that some two car families are switching to one to cut their outgoings, something for which we hear anecdotal evidence.

“However, there is also no doubt some families that are really feeling the pinch of the cost-of-living crisis have had to become carless, which is something that could have a real and very negative impact on their work and family lives.

“It’s always worth underlining that our monthly research looks at attitudes – it tracks how people are thinking about behaving as well as what they are actually doing – so there are almost certainly not many cars yet being sold but these latest findings make it clear that running a vehicle is becoming much more difficult for the many families hit by the cost-of-living crisis.”

Second hand appeal

Startline said the research shows a likely consumer preference shift towards smaller models as well as hybrids and electric vehicles (EVs) as people try to reduce their outgoings.

Used cars are also becoming better buys as prices are dropping on second hand car values. Data published by Indicata showed that the UK remains the only European country to experience a decline in used car values during 2022.

Burgess added: “There has been a slight fall in used car prices this year and there will probably be another during the next few months.

“Although these are quite small percentages, perhaps potential buyers are noticing. There is certainly an argument that used cars are becoming better value, certainly compared to ongoing price rises for new cars.”