Motor Trade Insurance

Consumer Car Finance Volumes Drop In February 2020

April 23, 2020 by Logan Biggs

Motor traders will be interested to read that in February 2020 the volume of consumer car finance new business volumes reduced by 1% in comparison to February 2019 according to the Finance and Leasing Association (FLA).  A drop of 8% was seen in the volume of new consumer finance for new cars between the same periods but there was a rise of 1% in the volume of new consumer finance for second hand cars between the same periods.

Of course, let’s not forget that these figures were really before the coronavirus pandemic took hold here in the UK so it is going to be very interesting to see the figures that are produced for the few months after the above ones covered. We are probably going to see a significant reduction in the volume of new car finance for both used and new cars as there will no doubt have been a significant drop in the numbers of such cars sold as people are currently in lockdown and such businesses selling these vehicles are closed.

It would be interesting if we knew what impact there is on the number of cars motor traders sell if they offer in-house motor finance to their customers. Are you more likely to sell a new or used car if you offer your customer motor finance at point of sale? There will no doubt be some car buyers who source their motor finance from the likes of their bank but there will be others who are quite happy to arrange such finance in the car showroom.

In 2019, members of the Finance and Leasing Association, arranged £48 billion of new consumer car financing with £38 billion of it being at point of sale. Perhaps this is an indication of the appeal of in –house car finance has to the car buyer.

We will continue to keep our motor trader readers up to date with interesting statistics relating to motor finance.

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