CarGurus Study Reveals Shifting Consumer Preferences as Automotive Landscape Evolves and Costs Remain Elevated
March 25 2024 - 9:00AM
CarGurus (Nasdaq: CARG), the No. 1 visited digital auto platform
for shopping, buying, and selling new and used vehicles1, today
released its sixth annual U.S. Consumer Insights Report, revealing
how shoppers’ habits have shifted in response to an automotive
market where interest rates and costs continue to be elevated;
selection is growing; and there are more opportunities to do more
from home.
The survey of recent car purchasers
and/or sellers2 examines factors influencing why and where people
buy and sell, as well as their preferences to navigate some—or
all—portions of a transaction online. For a complete picture of the
buy/sell journey, the survey also considered sentiment after the
transaction.
Leading findings include:
- Vehicle reliability and costs were more important to
consumers compared to prior years. While vehicle costs and
reliability remain the dominant factors influencing decisions, more
shoppers today are likely to cite reliability (41% vs. 35% in
2022), finding a vehicle that fits their budget (40% vs. 33% in
2022), and expected costs (26% vs. 21% in 2022) as the most
important factors in selecting a vehicle. Findings point to these
priorities trumping loyalty to a specific make or model, with 89%
saying they’d be willing to switch models and 69% open to switching
brands.
- The best price often determines where consumers
buy. According to findings, price remains the top priority
in determining the seller they select, with 55% of respondents
saying it’s the most important factor, followed by inventory
selection (34%), and availability of financing or special offers
(26%). Notably, confidence in being treated fairly increased (23%
vs. 17% in 2022).
- Consumers are more open to selling their vehicle
entirely online. 82% of consumers are open to selling
their vehicle entirely online (up from 77% in 2022). In tandem, 69%
of shoppers say they want to conduct more of the buying process
from home, particularly price negotiation and trade-in estimates.
The preference to do more from home has remained unchanged
year-over-year since rising from 60% in 2021, indicating a lasting
shift in behavior. Steps that mainly occur online (or a combination
of online and in-person) include researching what vehicle to buy
(81%), assessing the value of a car to be sold (77%), and getting
offers to sell a car (69%).
- Financing declines year-over-year. According
to findings, 42% of buyers apply for financing before a dealer
visit. However, 56% of respondents say they financed (down from 60%
in 2022), with many opting to buy in cash due to higher interest
rates.
- More young buyers purchased their first car in
2023. Of those who said they bought or leased their first
car in 2023, 27% were Gen Z which was up from 20% in 2022. The most
popular brands among Gen Z respondents as a whole include Toyota,
Chevrolet, Honda, BMW, and Ford.
- Electric Vehicle (EV) consideration continues to
grow. More shoppers are considering EVs (27% vs. 22% in
2022 vs. 16% in 2021). However, purchase rates among respondents
remain low, with 8% reporting an EV purchase (up from 5% a year
prior). According to findings, 84% of those that had purchased a
gas vehicle are sticking with gas, while 20% of those who purchased
an EV, and 25% of those who purchased a hybrid, switched to
gas.
“The automotive market has seen
incredible change within the last few years, with pricing and
inventory levels in flux, EVs becoming more mainstream, and more
paths to purchase–especially online–available for shoppers,” said
Alison Ciummei, Director of Product Marketing at CarGurus. “As we
examine how these factors have impacted buying and selling habits,
there is a consensus: consumers are taking control of the process
in a way that makes the most sense for their individual goals for
pricing, convenience, and confidence in the transaction. Whether
that involves exploring financing options, considering a trade-in,
or comparing vehicles against specific needs, shoppers are looking
to both digital retail tools and dealership support to tailor the
most seamless experience possible.”
The full study from CarGurus is
available for download here.
2Methodology
Data is primarily sourced from a
June/July 2023 study conducted by CarGurus and GfK, a leading
market research firm. The study included a survey of 3,185
past-four-month auto purchasers/sellers of new or used automobiles:
n=3,012 opt-in sample and n=173 CarGurus CRM sample. Respondents
could qualify as both buyers and sellers, are 18+ years old, and
weighted to be representative of the U.S. auto market in terms of
demographics (age, gender, income, etc.) and market factors (new/
used, price point, etc.).
About CarGurus
CarGurus (Nasdaq: CARG) is a multinational, online automotive
platform for buying and selling vehicles that is building upon its
industry-leading listings marketplace with both digital retail
solutions and the CarOffer online wholesale platform. The CarGurus
platform gives consumers the confidence to purchase and/or sell a
vehicle either online or in-person, and it gives dealerships the
power to accurately price, effectively market, instantly acquire,
and quickly sell vehicles, all with a nationwide reach. The company
uses proprietary technology, search algorithms, and data analytics
to bring trust, transparency, and competitive pricing to the
automotive shopping experience. CarGurus is the most visited
automotive shopping site in the U.S. 1
CarGurus also operates online marketplaces under the CarGurus
brand in Canada and the U.K. In the U.S. and the U.K., CarGurus
also operates the Autolist and PistonHeads online marketplaces,
respectively, as independent brands.
To learn more about CarGurus, visit www.cargurus.com, and for
more information about CarOffer, visit www.caroffer.com.
CarGurus® is a registered trademark of CarGurus, Inc., and
CarOffer® is a registered trademark of CarOffer, LLC. All other
product names, trademarks and registered trademarks are the
property of their respective owners.
1 Source: Similarweb
Traffic Report, Q4 2023, U.S.
Media
Contact:Maggie MeluzioDirector, Public Relations &
External Communicationspr@cargurus.com
Investor Contact:Kirndeep SinghVice President,
Investor Relationsinvestors@cargurus.com
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