2024 Capital One Car Buying Outlook

Car ownership is a life-changing milestone. It brings freedom, opportunity, and stability, and can truly transform people's lives. Yet, as critical as car ownership is, the reality today is most people cannot simply walk into a dealership and pick any car on the showroom floor. Buying a car is in many cases the second-largest purchase a person will make in their lives, and many factors can influence the final purchasing decision.

Dealers and buyers are after the same outcome—putting people in the cars that they love, on terms they can afford. While buyers and dealers naturally approach how to reach this outcome in the buying process differently, one area where they ought to find common ground is transparency in the process. Dealers are uniquely positioned to infuse transparency along the way and build trust with their customers.

However, right now, there’s a perception gap: Nearly three-quarters of dealers believe the car buying process is transparent but only half of buyers feel the same. There’s good news—that gap is closing, but there’s more work to be done. Dealers can and should lead the way to close it, as bridging that gap can be as important as finding the right final purchase price to make the deal work.

The ways car buyers and dealers come together are evolving fast. Car buyers are using more digital resources, doing more research and becoming more informed on the purchasing process, applying what they learn online to the showroom when completing the process. For their part, dealers are investing in new digital tools to empower customers with more information so they feel ready when they come in for the test drive and purchase—helping to bridge the digital and in-person experiences so they complement one another.

New tools and channels make the process easier than before, but they change it as well. How should the digital and physical, in-person steps connect? The dealership experience remains central, but how is it evolving? In order for dealers to meet buyers where they are on preference and price, there must be a shared understanding of transparency and trust. The data in the Car Buying Outlook can help dealers find and understand that common ground, and help everyone win.

When both sides work together, buying and selling cars can be seamless. There are many paths that lead to that moment of driving off the lot, but it’s a moment that happens more often, and with better results, when the journey there is smooth. Owning a car is more than an emotional milestone; it’s essential to the prosperity and well-being of Americans and their families. Our job—no matter where in the industry we sit is to make that a reality accessible to everyone.

The rise of online car buying tools is a positive shift. But digital doesn’t replace the physical—it complements it. Results from the 2024 Car Buying Outlook indicate the in-person dealership experience remains critical to the overall car buying journey.

The Car Buying Outlook underscores how trust is essential in car buying—and how much trust hinges on transparency. Trust doesn’t thrive when one side holds all the information. Buyers value accurate information, and they value salespeople who actively help them access it. In fact, car buyers who feel the car buying process is transparent are 2.75 times as likely to trust car dealers. And buyers who trust their dealers are more than 7 times as likely to find the car buying process transparent.

Digital tools play a key role in fostering trust by making timely, transparent information easily accessible to both buyers and dealers. According to Capital One customers, nine in 10 buyers who used Auto Navigator said they found transparent financing options.

With the number of online car buying options, there’s been speculation that the role of the dealer might diminish. But the data tells a different story. Digitally empowered customers are completing more steps of the car buying process in person at dealerships, not fewer, and most customers still want to decide on final details face to face.

Trust is one driving force behind why buyers choose to return to a dealership. Transparency is key in fostering that trust. However, there remains a gap in dealer and car buyer perceptions of transparency in the car buying process.

Very few car buyers complete their purchases entirely online, though most buyers complete early steps at least partially online. They arrive at the dealership with more information about models, inventories and financing options—and make more of the time they spend on site.

The Capital One Car Buying Outlook consists of findings from two surveys targeted to car buyers and dealers, both of which were conducted on behalf of Capital One Auto Finance through Morning Consult.

The consumer survey of nearly 2,000 U.S. adults ages 18+ who indicated they purchased a car from an auto dealership in the preceding six months was fielded May 1-7, 2024 with a margin of error of +/- 2%. Generational data was pulled for Boomers and older (ages 59+) Generation X (43-58), Millennials (27-42) and Generation Z (18-26).

The dealer survey consists of over 600 U.S. car dealers. These respondents currently work for an automobile dealership as an owner, general manager, F&I director, sales manager, internet manager or in the business development center at dealerships with an approximate annual sales volume of at least $1M. The survey was fielded May 1-20, 2024, with a margin of error of +/- 4%.

Findings are compared to the 2023 Car Buying Outlook (fielded to 2,210 U.S. car buyers and 400 U.S. car dealers between October 10-15, 2022 with a margin of error of +/- 2%), the July 2022 Car Buying Outlook (fielded to 2,209 car buyers and 400 car dealers between June 7-13, 2022), the March 2022 Car Buying Outlook (fielded to 2,200 car buyers and 530 car dealers between October 20-29, 2021), and the 2021 Car Buying Outlook (fielded to 1,000 car buyers and 401 car dealers between October 1-20, 2020).