Smaller cars used to cut cover

One in five drivers (19%) has downsized or sold a car since the onset of the credit crunch, adding up to a total of £4m estimated savings in the UK, London Victoria (LV) has found.

It’s research said:

• Six out of ten drivers (61%) said they downsized because of concerns about the rising cost of fuel
• One in three (29%) downsized to get cheaper insurance premiums
• Two in five drivers (43%) who are planning to buy another car in the next 12 months are intending to buy second-hand
• Two in three (66%) of these say they can't afford to buy a brand new car because of the current economic climate

The main reason given by motorists for downsizing their vehicle over the last eighteen months was to save money on fuel (61%). Nearly a third (29%) said they did it to reduce insurance premiums and the same number said they wanted to cut the cost of road tax (29%).

On average, those one in five drivers who have downsized their car estimate they have already saved an average of £309.

Almost a quarter (23%) of respondents to the LV= survey said they would consider buying a second hand car to reduce their insurance premiums.

John O'Roarke, Managing Director of LV= Car Insurance, said: "Buying a car is often the second biggest purchase people make after their house. So it's only natural that in the current economic downturn, when people are being more careful with their money, they also look to save on their motoring costs.