Used cars are increasingly taking the lead in the auto finance market as the UK new car market struggles.
New figures released by the Finance & Leasing Association (FLA) show that new business volumes in the point of sale (POS) consumer new car finance market fell by 8% in November 2017, compared with the same month a year ago.
For the 12 months to the end of November, the number of new cars bought on finance by FLA members fell 7% year-on-year.
A trend towards premium and off-road models meant the value of advances continued to increase even as the market fell, with total new car advances up 2% year-on-year both for November and for the previous 12 months.
The percentage of private new car sales financed by FLA members through the POS was 85.9% in the 12 months to November, compared with 86.1% in the same period to October.
The used car market was much more robust, with advances up 16% and vehicles financed up 10% in November, with rolling 12 months growth of 11% and 6% respectively.
Geraldine Kilkelly, head of research and chief economist at the FLA, said: “The POS consumer car finance market remains on target to report new business volumes of 2.3 million in 2017 as a whole, a similar level to 2016.
“The performance of the POS consumer new car finance market in November continued to reflect trends in private new car sales. FLA members’ penetration of this market has held steady over the past year at around 86%.”
Cars bought on finance by consumers through dealerships
| New business | Nov 17 |
% change on prev yr |
3 mths to Nov 17 |
% change on prev yr |
12 mths to Nov 17 |
% change on prev yr |
|---|---|---|---|---|---|---|
| New cars | ||||||
| Value of advances (£m) | 1,385 | +2 | 5,627 | +1 | 18,413 | +2 |
| Number of cars | 69,287 | -8 | 284,432 | -9 | 974,049 | -7 |
| Used cars | ||||||
| Value of advances (£m) | 1,237 | +16 | 3,866 | +13 | 15,003 | +11 |
| Number of cars | 104,683 | +10 | 331,601 | +7 | 1,322,786 | +6 |
