2. CONTENTS
Introduction 3
Key findings 4
Long road to recovery 5
Young drivers at risk 67
Top tips to help young drivers reduce costs 8
Cost of motoring set to soar 9 10
Motorists forced to adapt to rising costs 11
Future of motoring 12
Cars of 2023 13 - 15
About Auto Trader 16
2
3. INTRODUCTION
Welcome to the Auto Trader Owners’ Guide ‘Future of Motoring’ report,
which this quarter explores the anticipated evolution in motoring over the
years to come. We have surveyed 3,495 motorists to gauge their views on
what the future of motoring has in store, looking at everything from soaring
running costs to the possibility of flying cars. We have also worked with
Futurologist Ian Pearson whose insights and predictions have helped shape
this report.
Motoring as we know it is set to change drastically over the next ten years as a direct result
of economic, technological and demographic changes. Although Britain may have come out
of the double-dip recession, the financial squeeze continues to be felt across all aspects of
21st century life. The younger generation are the most at risk, faced with limited personal
finances, a crippling rate of youth unemployment and constant price hikes to the
cost of motoring.
Although economic recovery will be slow, companies – not just automotive – are heavily
investing in research and development, so we can expect significant technological
advancements that will considerably change how we drive over the coming years. Trials
are already underway for a new era of motoring; this includes self-driving technology, a
concept that is expected to be a common feature on our roads in as little as ten years time.
Futurologist Ian Pearson believes that gradually cars will become smart enough to do all the
hard work for us: drive us from A to B, reduce accidents and comply with speed limits and
other road laws. As electronic control of cars is likely to eventually become mandatory, this
is sure to have a major impact not only on motorists but across all areas
of transportation.
Motorists will be forced to adapt their current driving behaviours if they are to keep up
with constant increases to the cost of motoring and to make way for new technological
developments. One thing we can be sure of is that a new dawn of motoring
is fast approaching.
Nathan Coe
Group Director, Auto Trader
3
4. Key findings
62% anticipate cars will be able to communicate with each other
within the next ten years
42% expect self-driving cars to be a common feature on UK roads by 2023
the amount motoring costs in the UK could reach by 2023
£135bn
55%
of motorists believe they could not afford to be a first time driver today
think the government is not doing enough to support road users
98% of the future
4
5. s
Long road to recovery
Market shows signs of recovery, but future looks bleak
for young drivers
2012 was a turbulent year for the automotive industry. Following six months of decline, the
market started to show small signs of recovery as the UK emerged from the double-dip
recession reporting 1% GDP growth in Q3 2012. While GDP declined once more in Q4 2012, the
automotive industry indicated signs of economic healing, reflected by Auto Trader’s Retail Price
Index which provides insight into average used car prices. December 2012 marked the highest
average price for used cars for the year (£8,982) and Q4 2012 showed a reassuring 2.3% quarter-
on-quarter increase.
“ The economy will follow a ‘Loch Ness Monster’
recovery pattern featuring multiple dips. This
will mean ongoing and increasing pressure
”
on consumer spending power.
Ian Pearson, Futurologist
Average Asking Price Q4
£9,200 Average Asking Price in Q4
Average Asking Price in Q4
£9,200
£9,200
£9,000 -3.2%
£9,000
-3.2% 1.7%
1.7%
£9,000
£8,800 £9,056
£8,800
£8,800
£8,600 £8,912
£8,600
£8,600 £8,764
£8,400 £9,056
£9,056 £8,912
£8,912
£8,400
£8,400 £8,764
£8,200 £8,764
£8,200
£8,200
£8,000
£8,000
£8,000
Q4 2010
Q4 2010
Q4 2010 Q4 2011
Q4 2011
Q4 2011 Q4 2012
Q4 2012
Q4 2012
FAST FACT:
Although the Auto Trader Retail Price Index reveals the average asking
price of a car has increased in the latter half of 2012, prices for the year are
still 2% lower than in 2011
5
6. Young drivers at risk
Although we have seen green shoots of economic recovery, 42% of motorists think we are not yet
over the worst and that we will continue to feel the financial squeeze in 2013. Motorists believe this
will impact most heavily on young drivers who face being priced off the road as a result of soaring
motoring costs, including new insurance legislation, as well as a high rate of youth unemployment.
• 55% of motorists believe they could not afford to be a first time driver today
• his is especially true of women – just 28% of those who have been driving for over
T
five years think they could afford to be a first time motorist today compared to 59% of men
• Over half (53%) of 17-24 year olds believe the worsening economic situation and
increased financial pressures will lead to a decrease in the number of young people
learning to drive over the next decade. This is compared to just a third (33%)
of over 65 year olds
• 71% think it will be difficult for young people to buy cars in ten years time
• 98% of consumers think the government is not doing enough to support future road users
What should the Government be doing to support future road users?
They should regulate fuel costs better 78%
They should be lowering driving-related taxation 52%
They should be preparing the country for
new types of engine and fuel 46%
They should be investing more in infrastructure 40%
They should re-write driving laws to reflect
the situation facing 21st century motorists 31%
They should be investing more in the
British car industry 27%
Other 5%
They are doing enough already 2%
6
7. Female motorists hit hardest following new gender ruling
Young female drivers are set to lose out following the introduction in December 2012 of
new European rules banning insurers from taking gender into account when calculating
rates. Prior to the ruling, female motorists aged 17-25 paid on average £1,000 less than
their male counterparts in annual car cover.1 According to the Association of British
Insurers (ABI), the new ruling could result in a 25% increase in the annual cost of
insurance for young female drivers.2 This could lead to one in four women (24%) being
priced off the road as they struggle to keep up with rising costs according to research
from uSwitch.com.3
The new unisex rate is likely to have a significant impact on the market as a whole.
We could see an increase in the average cost of insurance as risk rises, as well as a
reduction in the number of young female drivers on the road.
One in four female drivers could be
priced off the road by new EU law
“
In years to come, we are likely to see road train technology that
lets one driver control a line of vehicles. This could be used
to allow semi-autonomous convoys of young drivers under
the control of a more senior leader to reduce accidents and,
”
hence, drive down the cost of insurance.
Ian Pearson, Futurologist
Learning to drive alone costs on average £1,1274 in the UK and first time motorists are being
doubly hit by increases in the price of older vehicles. Traditionally young drivers buy cheaper
and older cars and according to Auto Trader’s Retail Price Index the price of vehicles over
ten years old has gone up 5%, so they now average £2,414, making it even harder for young
drivers to get behind the wheel.
1 Gocompare.com, as of July 2012, the average difference on Gocompare quoted premiums in the 17-25 age bracket was £1,060 (£2,394 for men against £1,334 for women).
2 Association of British Insurers (ABI), Research Paper No. 24, (2010).
3 USwitch.com, ‘New insurance could force one in four women off the road’, (November 14 2012).
7
4 Assuming learner passes both theory and practical test (priced £31 and £62 respectively) first time round and based on an average of 47 lessons priced at £24 each.
8. Top tips to help young drivers
reduce costs
1. onsider buying a new car: Buying a new car might seem like a hefty
C
investment but it could save you money in the long run. New cars are designed
to give out fewer emissions, saving you money on your insurance and tax.
Generally speaking, maintenance costs on new cars are considerably lower
and they also come on average with a minimum three year warranty.
2. hink about leasing a car: The majority of dealerships today
T
offer a car leasing option, perfect for young drivers who may not have
the upfront capital to buy a car outright. Leasing a car over a set period of
time means you pay a flat monthly rate and many packages also include
maintenance costs, so you know exactly how much the car will be setting
you back when you sign the contract.
3. etrol is just as economical as diesel...and cheaper:
P
Don’t rule out petrol models if you are looking for an economical car.
While costs may vary depending on engine size and mileage, modern
petrol engines are becoming almost as economical as diesel cars and
will also help you save money at the pumps.
4. e rewarded for good driving: Some car insurers are offering
B
new technology ‘telematics’ which monitors how you drive and rewards
safe motoring with cheaper premiums. The number of insurers offering
this service is expected to become more widely available and is a great
option for all responsible drivers.
5. on’t be scared to haggle: Do your research and shop about to
D
make sure that the car’s price is in line with other cars of its kind to ensure
you pay its true value. If you’re confident, you can haggle anywhere up to
10% off the original asking price. There could also be room for negotiation
across finance and servicing costs of a car.
8
9. Cost of motoring set to soar
Motorists fear costs could double over next ten years
Brits fear that by 2023 motoring costs in the UK could account for over £135bn including
fuel prices, insurance and driving related taxation.
Our research revealed that the average car owner currently spends £2,290 on motoring costs
each year and some hard-hit Brits fear this amount could double to £4,580 in the next ten years.
This is reflected by the Auto Trader Retail Price Index which reveals that the average price
of a used car has also increased across all regions in the UK.
Average asking pricewinners and
Graphic: Illustrate regional
of a used car Excel doc sheet 3.
losers (Price Index
in Q4 2012 Map of the UK/rankup or
Design ideas:
regions – podium/medals/thumbs
the
down re where most expensive)
Scotland
£9,936
North
East
£8,387
Northern North
Ireland West
£9,963 £8,390
Yorkshire
Yorkshire
£9,490
East
Midlands
£8,680
East
West Anglia
Midlands £8,700
£8,143
Wales
£8,408
London
£9,392
South
South East
West £9,121
£7,968
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10. Alternative fuel vehicles gaining favour with motorists,
but market share still low
The number of alternatively fuelled vehicles for sale through Auto Trader has almost doubled over
the last three years, and this looks set to grow as motorists look for ways to dodge rising fuel
costs. The Auto Trader Retail Price Index reveals a significant quarter-on-quarter decrease of
6% (£1,066) in Q4 2012 in the average price of alternatively fuelled cars as they start to hit the
mainstream. However, this still remains a very small percentage of cars advertised on Auto Trader,
a trend which has been seen across the industry as a whole. Research from GfK has revealed the
main inhibitors to people buying an electric vehicle are the high purchase price - compared to a
conventional car - and practical issues relating to the range of the batteries between charging, the
length of time that recharging takes, and the availability of charging points.5
Petrol cars
see an increase
in price this quarter
of 3% to £7,034.
Q2 2012 saw the
lowest priced petrol
cars in the last three
years but the second
half of 2012 saw
prices pick up again.
Petrol Alternatively fuelled
vehicles saw Electric
quarter-on-quarter
decreases of 6%
and year-on-year
decreases of 2% as the
average price drops £1,066
from Q3 to Q4.
While the electric car revolution may be taking longer to get into gear than initially
ry
Commenta anticipated, manufacturers are still investing heavily in alternatively fuelled vehicles and,
if prices continue to fall, we could see a growth in market penetration.
10
5
GfK, Automotive Sustainable Mobility Report, (2012).
11. Motorists forced to adapt to
rising costs
Consumers look to offset price increases by changing their
motoring behaviour
Consumers acknowledge they will have to change their current driving patterns if they
are to keep up with the relentless increases to the cost of motoring.
How will consumers
change their motoring
behaviour?
49% 41% 23% 18% 13% 4%
Drive fewer Buy more Cut down I will not Cut down on Take on
miles or cost effective spending change the number debt to pay
drive less cars in other my spending of cars in for rising
frequently non-motoring habits to my family motoring
areas compensate costs
for higher
motoring costs
This year 22% of motorists who bought a car chose their vehicle specifically to help
ry
Commenta reduce running costs. This number is set to increase as consumers become more savvy
when it comes to getting the most bang for their buck. We’ve seen a surge in sales of low
emission cars, such as the two cylinder fiat 500 which comes with £0 annual road tax. It’s
almost impossible to find one now as they have become so popular!
11
12. Future of motoring
‘Road tribes’ of the future
“
As motorists continue to feel the economic squeeze, almost one in
five of those surveyed would consider money saving tactics such
as car pooling - that’s treble the current amount! As motorists are
forced to adapt their current driving behaviour we are likely to see
the emergence of new social networks to facilitate alternatives, such
as car pooling, with set regulations. This will allow sharing of costs
and enhance security so that strangers can share safely. Social
networks would work to match journeys to passengers and we could
see ‘road tribes’ emerging, such as school run mums or commuters.
”
Ian Pearson, Futurologist
The next generation of cars
Consumers have become accustomed to high-tech gadgets and devices across all areas of 21st
century life, and motoring is no exception to this trend. Motorists anticipate drastic changes to
the present state of driving making it safer, easier and more sustainable.
12
13. The Cars of 2023
Technology motorists expect to see in next ten years
84% 76% 62% 76% 78% 80% 62%
Technology Voice command/ Turning your Augmented Airbags that help Energy storing Cars that
letting you recognition to windows reality stop cars panels communicate
42% know where control the car into touch dashboards with each
Self-driving
cars
there are
parking
screens other
88%
spaces Electric
cars
“
Although only 7% of women surveyed for this report said they would
be willing to pay more for extra gadgets such as augmented reality
dashboards compared to 18% of men, we are likely to see a shift
in perception as such technology becomes more commonplace.
Women will want more augmented reality than men when it is
used to augment view with familiar landmarks. Women traditionally
navigate more by landmarks than men and are sure to benefit
”
from social, tourist and retail information that such
technology would provide.
Ian Pearson, Futurologist
Women Men
1 A
irbags that help protect Top Five 1 Electric powered cars
the car’s exterior 2 Energy storing panels
2 Electric powered cars
innovations 3 A
irbags that help protect
3 Energy storing panels Motorists Would the car’s exterior
4 4 T
echnology that indicates
T
echnology that indicates
where there are parking
Be Willing To where there are parking
spaces
spaces
Pay For 5
5 Self-driving technology Self-driving technology
13
14. Cars designed around you
“ Already we’re seeing great technological improvements when it comes
to tailoring everything from insurance rates to interior design around the
individual. ‘One size fits all’ policies and cars will become a thing of the
past as consumers demand a more personalised experience. In the years to
come, a couple could have their own décor in the same shared vehicle thanks
to improvements in fabric material which can be self cleaning, emit light,
change colour and even give off scents under electronic control!
Glass, PC and particularly Games manufacturers have taken interest
in virtual developments in the car industry. Cars could soon boast
”
touch-screen windows, 3D technology and allow for all elements of
the car to be manipulated to make for a more engaging environment.
Ian Pearson, Futurologist
Look, no hands!
A new and revolutionary innovation is fast
approaching: the driverless car. While only “The car could
17% of motorists surveyed for this report
said this is something they would be willing
become a totally
to pay for, this new technology is set to digitally immersive
bring about profound changes to the future
of driving. The new technology, currently environment!”
being trialled by multiple companies,
including Google, is expected to be a common feature on our roads in as little
as ten years time.
Autonomous cars are expected to bring many major
benefits including:
- major reduction in accidents due to sensor technology that predicts
A
and avoids collisions
- Creating up to five times more space for vehicles on the roads by cars
driving nose to tail
- reeing up parking spaces in congested areas by dropping you off and coming
F
back to pick you up when you are ready
“ Self-driving cars will be far more attractive to young drivers due to reduced
accidents and, hence, insurance. This is likely to accelerate market penetration.
”
Autonomous technology will eventually be a basis of public transport
as well as corporate and private travel, which will bring down costs.
Ian Pearson, Futurologist
14
15. Cars won’t be flying anytime soon!
“
Although flying cars do exist in prototype, it is very doubtful that we will see
many flying cars in the next few decades. Realistically, they are only likely to
become about as common as helicopters are today. In order to make them
safe, flying cars would have to be completely autonomous and would
”
need far better computers and communication networks than we
currently have. They will also be incredibly expensive!
Ian Pearson, Futurologist
Although the sci-fi vision in
‘The Fifth Element’ is fun, we
aren’t likely to see flying cars
Kobal
any time soon!
The final word
Electronic control of cars could gradually become mandatory to reduce accidents and
force compliance with speed limits and other road laws. As cars do all the hard work
for us, motorists will experience reduced freedom of driving style. However, with all the
technological advancements and trials currently underway, our passion for the open road is
sure to be reignited as we make way for a new era of motoring.
15
16. ABOUT AUTO TRADER
Auto Trader is the UK’s number one motoring digital marketplace with over 11 million monthly unique users, carrying out
over 135 million searches on more than 350,000 new and used vehicles. Over three million people access Auto Trader via their
mobile devices every month, through the mobile-optimised site and apps developed for iPhone, iPad, Android and Nokia. Auto
Trader is part of Trader Media Group. For more information, visit www.autotrader.co.uk.
Trader Media Group is Europe’s largest specialist multi-media group and supplier of leading automotive marketing products
and services. The Group also offers a range of other specialist online publications including vans.autotrader.co.uk, trucks.
autotrader.co.uk, plant.autotrader.co.uk, farm.autotrader.co.uk, autotrader.co.uk/bikes, caravans.autotrader.co.uk and
motorhomes.autotrader.co.uk. Trader Media Group operates in the UK, Ireland and South Africa and is jointly owned by
Guardian Media Group and Apax Partners. For more information, visit www.tradermediagroup.com.
About Ian Pearson
Ian Pearson is a leading Futurologist, identifying and explaining the key changes ahead in every sector of business and
society that will arise as a result of rapidly changing technology.
Ian graduated in Applied Mathematics and Theoretical Physics from Queens University, Belfast. He has worked in most
branches of engineering and as a futurologist in the telecoms sector before setting up Futurizon, providing consultancy
and strategy on future technology.
Research methodology
Consumer Research:
In collaboration with eDigital Research, Auto Trader surveyed 3,495 motorists* in December 2012 on the following
industry-related topics:
- The general economy
- Vehicle running and ownership costs
- Personal finances and the future of motoring for young drivers
- Predictions about technological developments in motoring
*Motorists are defined in this instance as driving licence holders aged 17 years or more, and respondents were
recruited via the Auto Trader consumer panel, eDigital Research panel, and social media.
Auto Trader Retail Price Index research methodology:
Base Data and how average prices are calculated: The Auto Trader Retail Price Index monitors the movement
of advertised asking prices based on used vehicles advertised on autotrader.co.uk since January 2010. As
this represents over 80% of all available used cars for sale in the UK, Auto Trader is in a unique position to
comment on variations in advertised prices.
With more than 15,000 dealers – an estimated 85% of all car dealers in the UK – advertising their vehicles on
the Auto Trader website and the ability to sample up to 400,000 individual used cars each month, the impact of
natural fluctuations in the profile of the used cars (due to variations in age, mileage, condition) is minimised.
Data Cleansing for Auto Trader Retail Price Index: Using a variety of business and proprietary rules, raw advert
data is cleansed to ensure an accurate reflection of prices and to remove any anomalies such as entries that
lack sufficient information or duplicates.
For all media enquiries, please contact the Auto Trader Press Office at Citizen Relations:
T: 020 3451 9400
E: autotrader@citizenrelations.com
