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Small car sales to be boosted by rising car insurance and finance

13 May 2008

The need to reduce running costs like car insurance and finance is leading car drivers to consider downsizing with their next purchase, it has been revealed.

Soaring fuel prices, depreciation rates and road tax are also being considered by drivers as they think about what to buy next, a survey by Motorpoint car supermarket has found.

Compact MPV and supermini sales are said to have surged over the last 12 months as a "dramatic shift" in buying trends is predicted.

David Shelton, managing director of Motorpoint, said as many as 20 million people could alter to smaller vehicles in the wake of the credit crunch.

He continued: "It's clear that the benefits of a smaller car are becoming more important as a whole range of economic and environmental considerations start to bite."

Drivers have also been advised by the British Insurer Brokers' Association they could enjoy lower car insurance and road tax costs by switching to greener vehicles.