British consumers are being advised to shop around before choosing a new car and finance package.

The internet finace site Moneysupermarket said that 420,000 people were expected to buy new cars on September 1st, but said that many could be paying over-the-odds at local showrooms, when much better deals are available online.

In one example, a Volkswagen Golf 1.4 TSI 140 could cost around £15,995 at a local retailer. Online shoppers could get the car for just £11,000, a saving of 31 per cent.

Savings are also available on cheaper cars. Vauxhall's Corsa 1.0 12v Life hatchback retails at £8,910, but Moneysupermarket.com said that consumers could save themselves £2,410 by buying the car online.

"Consumers are getting savvier about shopping online for many things, such as financial products, groceries and holidays, but when it comes to buying a new car some people are still hesitant to look online, preferring to visit their local dealer instead," said John Sexton of Moneysupermarket.com.

"Buying online is really the best way to save money as many 'high-street' dealers often won't negotiate enough on new cars to reach a competitive price."

Those looking for finance for a new car can also save time and money by searching for a deal online.

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