Wasteful motorists missing the opportunity to save the environment and their money
With a ‘green’ Budget expected from Gordon Brown later this month, new research from Alliance & Leicester Personal Loans reveals that motorists are missing out on an opportunity to save the environment through their choice of car.
Despite an expected increase in taxes on ‘gas-guzzlers’ and environment-busting vehicles, only 2% of motorists are planning their next car to be an environmentally friendly ‘hybrid’ – a combination of a traditional petrol engine which also has the capability for clean electric motoring – and only 3% of motorists will choose their next car on the basis of its ‘green credentials’ or low emissions.
It is also apparent that while motorists are not looking for cars with ‘green credentials’ and taking advantage of any tax-breaks that may be on the horizon, millions of motorists could also be wasting over £3,000* by taking out expensive finance from a car dealership, many of which have interest rates well into double figures.
The research found that almost six in ten (58%) of those who do not use savings to purchase a car borrow money from lenders who are not known for offering the best loans on the market – car dealers and big-name high street banks. One quarter (26%) of those who borrow money to buy a car would do so from car dealers, and a further quarter (26%) would tend to borrow money from a big high street bank.
Richard Al-Dabbagh, Senior Loans Manager at Alliance & Leicester, commented: “Despite all the newspaper headlines telling us that global warming is about to reach crisis point, and speculation that environmentally unfriendly cars will bear the brunt of imminent tax hikes, people are still shunning the most environmentally friendly cars.
“It is also apparent that we are wasteful when choosing how to finance our new motor. Over half of those who borrow money to buy their car use finance that is clearly not the best deal on the market. Some car finance deals are well into double figures, and should be given a wide berth. With pricey finance being sold to you where you can find yourself overpaying by over £3,000* or more, it is worth spending ten minutes looking around for a good deal before heading into the dealership.”
The research also found:
- One quarter (23%) of motorists choose their new car based on reliability
- Three per cent of motorists expect to buy a 4x4 as their next car
- 46% of motorists take finance from the car dealer because they believe it is the quickest and easiest way
- One in four (26%) believe car dealers offer the most competitive deal
For consumers considering applying for a loan or switching provider, Alliance & Leicester's website, www.alliance-leicester.co.uk, provides access to useful tools to help guide them through their financial choices. The website has been awarded a Gold Award for Best Overall Site in the banking category (Blays Net Ranking Web Site Awards) and was particularly commended for its content and ease of use.
The site contains a Loan Calculator which lets people work out how much they can afford to borrow and decide how long they wish to spread their repayments for.
Alliance & Leicester personal loan customers can benefit from the following:
- An unsecured personal loan from as little as £1,000 to as much as £20,000
- A low typical APR of 6.3% for loans of £7,500 - £20,000 for telephone and Internet applications, and in branch for Premier current account customers
- Repayment over one to five years
- Fixed monthly repayments for the period of the loan
- Quick and easy application, online, via the phone or in branch
- No arrangement fees
- Optional loan protection for added peace of mind
- For further information, consumers should visit their local branch, call 0800 068 6611 or visit www.alliance-leicester.co.uk
For further information, please contact:
Steve Gracey, Alliance & Leicester 0116 200 3366
(Mobile: 07753 712674)
Alliance & Leicester Press Office 0116 200 3355
Charlotte McGregor/Steven Hilton, Wriglesworth 0207 845 7900
(Mobile: 07703 258 488)
Notes to Editors:
1) This research was carried out online by Tickbox.net between 16.02.07 and 19.02.07.
2) Examples of typical APRs for finance deals from car dealers as at 9 March 2007:
Point of Sale |
Typical APR |
Source |
Citroen |
14.4% |
Citroen website |
Vauxhall |
12.1% |
Vauxhall website |
Hyundai |
11.1% |
Hyundai website |
VW |
10.7% |
VW website |
Seat |
11.8% |
Seat Website |
Toyota |
11.6% |
Toyota website |
*Example Finance
A car loan of £8,340 from Citroen Finance example as of 23/02/07 from www.citroen.co.uk
After a deposit of £2,000, finance of £8,340 for a Citroen Berlingo Multispace at 14.4% APR over 36 months gives monthly payments of £278.58 a month, and a total cost of £12,674.00.
An Alliance & Leicester loan of £8,340 at 6.3% (typical) APR over 36 months gives a monthly payment of £254.34 a month, and a total cost of £9,156.24. A saving of £3,517.76
Think carefully before securing other debts against your home, your home may be repossessed if you do not keep up repayments on your mortgage.
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