Impact of COVID-19 on consumer choices in the pre-owned car segment in Gauteng

Abstract

The current study explored changes in consumer behaviour in South Africa's pre-owned car segment following the COVID-19 pandemic. The study focused on supply and demand dynamics between new and used vehicles. It emphasized the automotive retail sector's essential role in economic growth, especially in developing counties. The research aims to assess the pandemic's impact on consumer purchasing behaviour, focusing on changes in motivations and decision-making processes. The key questions investigate shifts in supply and demand, alterations in purchasing patterns, and the sustainability of these trends in the pre-owned car segment. The study's rationale was to enhance the existing literature on automotive pre-owned retail segment and consumer intent, aiding stakeholders in adapting strategies to meet changing consumer needs. Using a quantitative method, the study surveyed individuals in Gauteng who bought pre- owned vehicles in the past three years and a Structural Equation Model (SEM) was used to analyse the relationships between perceived reliability, value, quality on consumer attitude to purchase, and the influence of remote work on consumer purchase intentions. The study employed the Theory of Second-Hand Markets and the Theory of Planned Behaviour as its primary theoretical frameworks. These frameworks helped to understand consumer behaviour in the pre-owned car segment following the COVID-19 pandemic. This theoretical foundation enhanced the study's analysis of the shift in consumer choices and the evolving landscape of the automotive pre-owned segment in a post-pandemic world. The findings of the study revealed participants prefer to use financing options over such as loans and car finance over cash payments. Another finding of the study pointed to perceived value emerging as a crucial determinant in consumer decision-making for pre-owned vehicles.