Announcing the 2024 Car Buying Outlook

New research from Capital One finds the in-person dealership experience remains vital for car buyers, even while using digital tools to streamline early stages of the process.

Car buyers’ trust in dealers is a key indicator of how transparent they perceive the car buying process—even with access to digital tools to complete key elements of their purchase. The 2024 Capital One Car Buying Outlook finds almost half (48%) of car buyers said they would be willing to go to a car dealership with higher prices if it was a dealership they could trust. Using online soft credit pulls and pre-qualification, car buyers can enter a dealership with a sense of their pricing options. This is where face-to-face interactions with knowledgeable salespeople become vital for dealers to foster trust and transparency. 

Key findings of the new 2024 Car Buying Outlook from Capital One include:

• 88 percent of car buyers conduct at least half of the car buying process in person, a 5 percentage point increase from last year’s report.

• 26 percent of car buyers said working with a dealer they trust is the most important part of the car buying experience—only 10 percent said getting the best price for the vehicle was most important. 

• Salespeople make the greatest difference in that in-person relationship—60 percent of buyers said sales reps contribute to trust.

• Car buyers who feel the car buying process is transparent are 2.75 times as likely to trust car dealers. And those who trust dealers are over 7 times more likely to find the car buying process transparent.

“The car buying experience calls for a unique standard of transparency and trust,” said Sanjiv Yajnik, President of Financial Services at Capital One. “Finding common ground is the key to robust sales and satisfied, loyal customers. The combination of powerful online tools and meaningful face-to-face interaction to build relationships is what drives this industry. Dealers that make the most of both avenues can give buyers the transparency they want, and when buyers feel the car buying process is transparent, they’re far more likely to trust dealers.”

Trust can help drive car buyers to a dealership, and transparency is an important source of trust. Most car buyers (52%) define transparency as a car’s price and financing being clear. Digital tools play a key role in fostering this trust by making timely, transparent information easily accessible to both buyers and dealers. Interestingly, more dealers than buyers think the process is transparent. When it comes to perceptions of transparency in car buying, this gap between dealers and buyers is closing, but still persists.  

• More than half of buyers (55%) found the buying process “very” or “completely” transparent, compared to 28 percent of buyers in the 2023 report. 

• 73 percent of dealers believe the process is transparent, closing the gap with car buyers to only 18 percentage points from the 40 percentage point gap in 2023. 

• Car buyers are twice as likely to return to the same dealer for their next car purchase if they find dealers trustworthy.

Digital tools are reshaping the early stages of car buying, with both dealers and buyers agreeing that digital tools help streamline the process. Yet, few buyers complete the entire car buying experience digitally—instead arriving at the dealership armed with detailed knowledge about models, inventory and financing. This empowers car buyers to maximize their time on the showroom floor, making the in-person experience more focused, efficient and informed.

• Almost three-quarters (72%) of buyers said they spent more than a month actively shopping for a car before they completed a purchase. 

• Customers who complete a soft credit pull for pre-qualification are 45% more likely to say the car buying process was transparent. 

• Yet, only about half (55%) of people complete a soft pull pre-qualification–with first-time buyers (74%), Gen Z (59%) and Millennials (68%) doing so the most frequently.

Using Capital One Auto Navigator and other online resources, today’s car buyers can learn a lot without leaving home: about car models and features, a dealer’s available inventory, and financing options. According to Capital One customers, nine in ten buyers who used Auto Navigator said they found transparent financing options. But that doesn’t mean car buyers are turning away from the traditional experience of visiting a dealership.

• There is a generational trend back toward the showroom: The percentage of people who bought “mostly or entirely” in-person is highest for Boomers (80%), lower for Generation X (64%), and lowest for Millennials (57%). 

• While Gen X and Millennials exhibited a generational trend out of the showroom, Gen Z (64%) car buyers are increasingly valuing the in-person dealership experience.

• 45% discuss pricing and financing with the dealer completely in person.

For more information, visit https://www.capitalone.com/about/car-buying-outlook/.

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). 

Capital One Financial Corporation (www.capitalone.com) is a financial holding company which, along with its subsidiaries, had $351.4 billion in deposits and $480.0 billion in total assets as of June 30, 2024. Headquartered in McLean, Virginia, Capital One offers a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One, N.A. has branches and Cafés located primarily in New York, Louisiana, Texas, Maryland, Virginia and the District of Columbia. A Fortune 500 company, Capital One trades on the New York Stock Exchange under the symbol “COF” and is included in the S&P 100 index.

Morning Consult is a global decision intelligence company changing how modern leaders make smarter, faster, better decisions. The company pairs its proprietary high-frequency data with applied artificial intelligence to better inform decisions on what people think and how they will act. Learn more at morningconsult.com.