2024
9
Germany Car Purchasing Process Market Report 2024
2024-06-18T13:01:25+01:00
REP85DE052D_574D_4414_B51D_B00BF23A7837
2195
173794
[{"name":"Automotive","url":"https:\/\/store.mintel.com\/industries\/transport\/automotive"}]
Report
en_GB
Car buyers' reliance on dealerships is falling. More new car buyers who purchased a car less than three years ago used online sources to gather information before purchase. While visiting…

Germany Car Purchasing Process Market Report 2024

£ 2,195 (Excl.Tax)

Report Summary

Car buyers’ reliance on dealerships is falling. More new car buyers who purchased a car less than three years ago used online sources to gather information before purchase. While visiting the website of a car brand is the most common online activity, the importance of social media personalities on car choice should not be underestimated.

47% of consumers with a net monthly household income below €1,500, and 30% with a net monthly household income €3,000+, are worried about not being able to cover day-to-day expenses, making it less likely for them to afford a car. The car market will be driven by consumers with high incomes who feel confident about their financial situation (41%).

Consumers are increasingly researching and buying cars online. While dealerships are crucial for product interaction and dominate as a purchasing channel, consumers’ increasing reliance on online sources poses a future threat to dealerships, who must adjust to this shift to remain relevant.

59% of consumers would choose one car retailer with physical stores over another if there was no pressure to purchase or the location was easy to explore, highlighting the importance for dealerships to prioritise a stress-free and convenient purchase experience. This can be achieved by incorporating digital solutions and enhancing interaction with cars.

This report looks at the following areas:

  • Key drivers affecting the car purchasing process, including the economic situation, role of social media and growth of AI
  • Plans to purchase a car, including by demographic group
  • Time spent buying a car, from research to purchase
  • Activities done during car purchase, including offline activities like dealership visits and test drives, and online activities such as visiting a brand’s website and social media
  • Channels to purchase, such as main dealers, independent dealers and manufacturers’ websites
  • Factors important when choosing a physical purchase channel

Car buyers are spending more time researching online and demand a seamless transition between channels to drive convenience and reduce stress.

Venkatesh Modi, Automotive Research Analyst, Germany

Table of Contents

  1. EXECUTIVE SUMMARY

    • The five-year outlook for the car purchasing process
    • Market context
    • Economic worries lead car buyers – even those with higher incomes – to increasingly prioritise value for money
    • Social media as a search engine can transform car purchasing
    • AI can enhance car purchasing with better recommendations and customisation
    • Mintel predicts
    • Social media integration will enhance the car purchasing process
    • Dealerships will assume a more consultative role as the industry transitions towards agency sales
    • Opportunities
    • Prioritise convenience and stress reduction at dealerships
    • Offer a smooth online-to-offline buying experience to meet wealthy car buyers’ needs
    • Graph 1: consumers who would be encouraged to choose one retailer over another due to informative website and ability to continue sales process online, by net monthly household income, 2024
    • Collaborate with YouTube influencers to aid young new car buyers in researching car features
    • Use social media at various purchase stages to harness its growing impact
    • Localise your social media strategy to attract Gen Zs and Millennials to visit car showrooms
  2. MARKET DRIVERS

    • The German economy
    • 2024 is expected to remain challenging
    • Graph 2: key economic data, in real terms, 2019-25
    • The inflation rate is bouncing back to more conventional levels
    • Inflation is still the key factor affecting consumers’ finances…
    • …confidence and expenditure
    • Graph 3: financial confidence index, 2022-24
    • Economic concerns will lead car buyers – even those with higher incomes – to place growing emphasis on value for money
    • Social media’s growing role in search
    • Use of social media as a search engine will change car purchasing
    • Growth of AI
    • AI can enhance car purchasing with better recommendations and customisation
    • Rise of alternatives to car ownership
    • Alternatives to car ownership will reduce the burden of research
  3. WHAT CONSUMERS WANT AND WHY

    • Car purchase plans
    • Ongoing interest in car purchases alongside lowering inflation is a good sign for the car market
    • Graph 4: plan to purchase a car within the next three years, 2024
    • Households with higher incomes fuel the demand for cars
    • Graph 5: plan to purchase a car within the next three years, by net monthly household income, 2024
    • Almost two thirds of Gen Z plan to buy a car in the next three years…
    • Graph 6: plan to purchase a car, by generation, 2024
    • …but most plan to purchase second-hand
    • Graph 7: type of planned car purchase, by generation, 2023
    • Optimise the car purchasing process for dual-parent families to leverage their high purchase intent
    • Time spent from research to purchase
    • Refine the purchasing process to align with the duration consumers dedicate to research
    • Graph 8: time spent from beginning of research to purchase, 2024
    • Simplify car interaction to enhance the buying process for those aged 55+
    • Graph 9: time spent from beginning of research to purchase, by age, 2024
    • Highlight innovation to capitalise on male consumers’ high interest in new cars
    • Graph 10: time spent from beginning of research to purchase, by gender, 2024
    • Educate and raise brand awareness among new car buyers in the initial stages
    • Graph 11: time spent from beginning of research to purchase, by type of car, 2024
    • Starting point for research
    • Few know the exact car they want at the beginning of purchase
    • Match marketing promotions with buyers’ initial knowledge base
    • Collaborate with YouTube influencers to aid young new car buyers research car features
    • Mercedes has continuously collaborated with an influencer to exhibit new cars
    • Activities done during car purchase
    • In-person interaction with a car is an important part of the purchasing process
    • The majority of consumers enhance their dealership visits with other research methods
    • Graph 12: repertoire of activities done during car purchase, 2024
    • New car buyers’ research approach is changing
    • Graph 13: activities done during car purchase, by car ownership details, 2024
    • Dealerships are becoming less important for searches, but remain crucial for inspections, test drives and purchasing
    • Leverage social media across the purchase process
    • Approach to car research varies across generations
    • Graph 14: activities done during car purchase, by generation, 2024
    • Encourage Gen Zs and Millennials to visit dealerships
    • Ways to encourage Gen Z and Millennial visits
    • Go beyond just car influencers to maximise reach
    • Channels to purchase
    • Dealers maintain their lead
    • Graph 15: channel of purchase, 2024
    • Increasing online manufacturer sales will drive the agency sales model
    • Graph 16: consumers who purchased a car from main dealer or direct from manufacturer website, by new car and time of car purchase, 2024
    • What is the agency sales model?
    • Factors important when choosing a physical purchase channel
    • Consumers want a stress-free purchase process
    • Create a convenient, low-stress experience to attract consumers
    • Dealerships: prioritise convenience and stress reduction to enhance the car buying experience
    • Methods to improve convenience and reduce sales pressure at car dealerships
    • Leverage pop-ups to generate buzz among urbanites
    • Cars in the city
    • Offer solutions that allow parents to shop with peace of mind
    • Provide a seamless experience to cater to affluent car buyers
    • Graph 17: consumers who would be encouraged to choose one retailer over another due to informative website and ability to continue sales process online, by net monthly household income, 2024
  4. brand/retailer activity

    • Hyundai enhances its online consultation and test drive experience
    • Renault partners with online car selling platform Carwow
    • Hyundai partners with Amazon
    • Porsche partners with its dealers to open a pop-up store in Berlin
    • NIO collaborates with a local influencer to raise awareness
    • Car dealer Gottfried Schultz organises an event for families
    • Cadillac enters the German premium car market and sells directly to consumers
  5. APPENDIX

    • Appendix – abbreviations, consumer research methodology and language usage
    • Abbreviations
    • Consumer research methodology
    • Repertoire analysis methodology
    • TURF analysis methodology
    • A note on language

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