Car Repairs

The UK used car market is experiencing a boom. In 2024 alone, used car sales jumped by 5.5%, with over 7.6 million used cars sold. This is a strong post-pandemic rebound. So, what’s fuelling this surge in the demand for pre-loved cars? Several key factors are at play, like the rising cost of new cars, supply chain issues and economic pressures. It’s also important to note the electric vehicle (EV) revolution and how this has started to impact the overall cost of running a car.

The Cost of New Cars Has Increased

Brand-new cars have never been pricier. The cost of new cars in the UK has risen in the last few years to around £39,000 on average. Even traditionally affordable models aren’t so cheap anymore – a basic VW Polo now costs over £20,000.

With new car price tags so high, lots of people just can’t justify or afford a factory-fresh vehicle. Instead, they’re turning to used cars as an alternative that’s a bit easier on the bank balance. Plus, new cars lose value quickly in the first year, so letting someone else take that initial depreciation hit by buying nearly-new makes good financial sense.

Supply Chain Woes Have Boosted Used Demand

It’s not just high prices driving people to used cars – it’s also availability. Since 2020, there have been some major supply chain disruptions (like the semiconductor chip shortage) that have cut new car production. In fact, in 2022, the UK saw just 1.61 million new cars registered (versus 2.31 million in 2019)​. Fewer new cars then means fewer used cars now; industry analysts estimate a shortfall of around half a million nearly-new vehicles in the market.

Tight supply means that buyers have been competing over the limited stock, which pushed used car prices up and kept demand strong. The new car supply is finally improving, but it will take time for those vehicles to flow into the used market.

Consumers Are Feeling the Financial Pinch

Another big factor is that British households are really feeling the squeeze when it comes to their finances. High inflation and rising bills have made everyone more cost-conscious. Choosing a used car over a new one can save you thousands of pounds upfront, which is massive when budgets are tight.

It’s easy to see why a driver would go for a reliable used motor instead of taking on a hefty new finance package. Industry experts note that amid economic uncertainty, consumers are increasingly likely to turn to the used car market.

Electric Vehicle Adoption Hits the Used Market

The shift to electric cars is shaking up the used car market. A wave of early EV adopters is now trading in their cars, which means more used EVs are on the scene. In fact, 2024 saw record sales of used electric cars. Transactions for pre-owned EVs jumped 57% year-on-year, and it now makes up around 2.5% of all used car sales​.

That share may be small, but it is growing fast.

Drivers are eager to go electric if the price is right, and the used market is making EVs more accessible. Many new electric models carry hefty price tags, but a few years down the line, they can be found used at a much lower cost. Plus, an influx of ex-lease and ex-fleet EVs is starting to nudge used EV prices down, which only encourages more buyers​.

The Cost of Running a Car is Increasing

It’s not just the purchase price of a vehicle that’s risen. The ongoing cost of running a car is a major consideration for buyers. Fuel, insurance, and tax costs have all climbed, with insurance premiums up by around 53% in the past two years​, and petrol/diesel prices (while down from their 2022 peak) are still higher than they were a few years ago.

On top of that, changes in taxation are coming into play.

From 2025, electric vehicles will no longer be exempt from road tax; new EVs will have to pay the standard VED rate (around £170 a year), and expensive models will face an extra £425 luxury car surcharge. What’s more, major urban areas like London have expanded low-emission zones that charge older high-polluting cars daily. All these factors make it more expensive to own and run a brand-new, high-value car. When compared with these costs, used car with good fuel economy and lower insurance groups can be much less of a financial burden.

Budgeting for Used Car Maintenance

Used vehicles might save your customers money upfront, but they usually mean more work for the workshop. Newer cars tend to get through the first few years with just routine servicing, and if anything does go wrong, the manufacturer’s warranty often covers it, so it never ends up in your hands

Older vehicles are a different matter. You are far more likely to see them in for diagnostics, general repairs or worn-out parts. Tyres, brakes and batteries often need replacing sooner, and once a car passes the three-year mark, the annual MOT can bring up all sorts of issues that need fixing. That puts extra pressure on your team to manage parts, time and customer expectations.

The upside is that many well-maintained used cars are straightforward to work on, and for the common models, parts are usually easy to source and reasonably priced. They might not be perfect, but used vehicles help keep your ramps full and your team busy.

Keep Used Car Repairs Affordable with Payment Assist

As we’ve discussed, the financial climate is far from predictable at the moment, and the last thing anybody needs is an eyewatering, unexpected car repair bill. At Payment Assist, we provide 0% car repair finance solutions that help your customers handle their car repair costs by splitting them into manageable monthly payments.

Typically a customer will pay 25% of the bill upfront, then spread the rest over the next three months interest-free. That means if you’re working on a used car that needs an expensive fix, you can get your customers back on the road without a big financial burden.

Garages, repair centres, and dealerships across the country have chosen to partner with us, enabling customers to get their cars fixed now and pay later with no extra charges. Sign up today to help your customers spread the cost of your car’s repairs, or get in touch with our team if you have any questions.

FAQs

Electric cars aren’t the same niche product that they used to be. These days, more drivers are making the switch, and garages are seeing a steady increase in electric car repairs and servicing. It’s true that these vehicles often come with lower running costs and fewer moving parts, but they also have a new, unique set of challenges when it comes to maintenance and repair.

If you’re offering garage services to electric cars, you might need specialist equipment or the ability to manage high-voltage risks, for example. Either way, getting to grips with electric car maintenance is more important than ever in a changing automotive landscape.

High-Voltage Systems and New Safety Risks

Unlike traditional vehicles, electric cars run on high-voltage battery packs, which are often between 400 and 800 volts. That’s more than enough to be lethal if it’s handled incorrectly. Mechanics need the right training if they’re going to be expected to work on these systems safely. It’s not just about avoiding electrocution, either; damage to a high-voltage battery can cause thermal runaway, which can be a fire hazard.

How can you reduce the risks?

First and foremost, garages need to invest in proper safety equipment – a standard set of spanners won’t cut it. This will likely include insulated tools, gloves, and voltage testers. On top of that, mechanics need to know how to shut down the system safely before they get to carrying out any work.

Battery Degradation and Expensive Replacements

Naturally, batteries are the most expensive component of an electric car. Through use and over time, though, they start to degrade, which can mean reduced range and performance for the driver. A typical battery is designed to last over 100,000 miles, but extreme temperatures, rapid charging, and deep discharges can speed up wear.

Replacing a battery pack is one of the most expensive electric car repairs. A new battery can cost thousands of pounds, making it a difficult decision for a lot of electric car owners. In some cases, reconditioning or replacing individual battery modules might be an option, but that comes with its own complications as it usually requires specialist knowledge and equipment.

Garages offering electric car maintenance will need to assess battery health using diagnostic tools. This isn’t the same as checking a standard car battery. It can quite often involve a detailed analysis of charge cycles, voltage levels, and cell temperatures.

Flexible payment options can make this easier for your customers.

Garage services that are prohibitively expensive put customers in a difficult position. Offering a flexible finance solution can help to make replacing an electric car’s battery more manageable and reduce the chances that a customer will abandon their electric car repair altogether.

Specialist Parts Can Lead to Limited Availability

One of the biggest challenges for garage services is getting hold of the right parts. In lots of cases, electric car components are harder to get your hands on than petrol or diesel options. Motors, inverters, and battery management systems are quite often manufacturer-specific, so parts have to be sourced directly from the carmaker.

Even common wear-and-tear items aren’t always straightforward.

Of course, electric cars don’t have exhausts, fuel pumps, or clutches to replace, but they still need brake pads, tyres, and suspension components. That said, these parts often differ from those on petrol and diesel cars. Regenerative braking means brake pads wear down less, but when they do need replacing, they may require specific parts.

If you run a repair centre, working with a reliable supplier who can source specialist electric car parts quickly is crucial. Otherwise, repair times can be much longer than for traditional cars.

Advanced Diagnostics and Software Updates

Electric cars are packed with electronics like battery management systems, regenerative braking, and thermal control. Having everything controlled by software is great for efficiency and driver experience, but it does mean that diagnosing faults isn’t as simple as plugging in an OBD2 scanner.

Some manufacturers use proprietary systems, which means that only authorised garages can access diagnostic data. Others require mechanics to complete brand-specific training before they can work on certain models.

Software updates are another consideration.

Lots of electric cars get over-the-air (OTA) updates- these bring fixes and improvements that are rolled out remotely. Not every issue can be solved this way, though, and if a vehicle needs a manual update or a recalibration after a repair, the garage needs to have the right tools and know-how to handle it.

Want to Make Electric Car Maintenance More Affordable for Your Customers?

Payment Assist helps you to offer flexible payment options to those customers seeking electric car repairs and servicing. Give drivers the option to spread the cost of repairs, making it easier to manage unexpected bills.

Payment Assist offers interest-free payment plans, helping you to secure more work while giving your clientele a practical way to afford essential repairs. It’s a simple, effective way to keep business moving.

Want to know more? Sign up today to see how Payment Assist can support your garage, or get in touch with us for a more detailed conversation.

When a car is damaged, deciding whether to repair it or replace it can be a tricky choice for many drivers. A recent survey has shed some light on the tipping point at which motorists might decide not to repair their damaged cars and why they might replace them instead. If you run a garage or repair centre, getting a handle on this tipping point and offering flexible finance options can help to increase repair rates. That means your customers can get their cars back on the road rather than feeling forced into an expensive write-off.

Car Repairs Can Be a Real Financial Struggle.

It’s no surprise that the rising cost of car repairs leads people to toy with fixing versus replacing a damaged car. When something major like engine repairs, wheel repairs, or bodywork is needed, a lot of drivers face that same dilemma. The survey – conducted by CarGurus – interviewed 1,000 motorists across the UK.

It found that an unexpected repair bill of £772 is one of the three breaking points that prompt drivers to consider their car a write-off, and look for a new vehicle. Once repair costs approach or exceed this amount, the financial burden can feel overwhelming, especially for those with tight budgets. This explains why nearly three-quarters (72%) of participants in the study said they’d feel stressed at the thought of having to spend money on unplanned car repairs.

Why Do Drivers Go for a Replacement Over a Repair?

There isn’t any single answer to this question, but it seems that the decision to replace a car instead of repairing it stems either from financial limitations or the perceived value of the vehicle. For example, if a car is worth £3,000 and the damage requires £2,500 worth of repairs, it’s easy to understand how this might be seen as a bad investment. They might believe that spending nearly the car’s worth on repairs doesn’t make sense, especially if it’s an older car that might need more repairs in the future.

Convenience could be another key factor.

The cost and hassle of repairs – and the fear of recurring issues – can make buying a new car seem like an easier and more financially sensible option. This is exacerbated by the fact that many new and second-hand dealerships offer finance options to make accessing a new car easier. Immediate financial pressures of car repairs can make it feel difficult or impossible to spend a large, upfront sum on car repairs.

That’s Where Flexible Finance Options Can Help

Flexible finance solutions can help motorists take the necessary steps to repair their damaged cars without having to face the full financial burden upfront. They provide a way to spread the cost of repairs over a manageable period, which makes paying for big jobs like engine repairs, bodywork, or wheel repairs much more feasible.

For lots of customers, this is a massive difference.

The ability to break down the cost of car repairs into smaller, more affordable payments might be the deciding factor between repair and replacement. If you offer interest-free, straightforward payment plans, you can ease the financial strain of the repairs and make it easier for drivers to choose fixing their car over scrapping it and getting a new one.

Why It’s Important to Understand the Tipping Point

If you own a repair centre or garage, you’ve got to get a handle on your customers’ tipping point when it comes to the cost of repairs. This is mainly because it helps you tailor your services and makes them more accessible, but there are other brilliant advantages, too.

Flexible finance could improve retention and trust.

Across sectors, we know that the outlook of customers changes when they feel valued and seen. You can promote a real sense of loyalty by showing your customers that you take their concerns seriously and that you identify with their real-life situations. This boosts confidence both in the repair process and the people who provide it.

Looking for a Flexible Finance Partner?

When your customers are faced with high costs, Payment Assist can help you to help them. Our service helps to break down substantial repair fees into manageable, interest-free monthly payments. Instead of feeling overwhelmed, your customers gain confidence, trust, and a sense of control over their finances.

With Payment Assist, you can:

Offer Interest-Free Payments: Customers pay no additional charges.
Maintain a Simple Application Process: Quick, transparent steps.
Provide Customisable Plans: Tailor instalments to each customer’s circumstances.
Promote Customer Retention: A supportive payment structure encourages repeat visits.

To find out more about how Payment Assist can support your business, get in touch with us today. Our team will be happy to help you.

FAQ