Car finance down in December
New figures released by the Finance & Leasing Association (FLA) show that consumer car finance new business by value and volume fell in December 2022 by six per cent compared with the same month in 2021.
In 2022 as a whole, new business grew nine per cent by value and three per cent by volume compared with 2021.
The consumer new car finance market reported a fall in new business of seven per cent by value and 16% by volume in December compared with the same month in 2021. In 2022 as a whole, new business volumes in this market remained seven per cent lower than in 2021.
The consumer used car finance market reported a fall in new business of four per cent by value and one per cent by volume in December compared with the same month in 2021. In the 2022 as a whole, new business volumes in this market were 8% higher than in 2021.
Geraldine Kilkelly, director of research and chief economist at the FLA, said: “The consumer car finance market showed signs of softer demand in the final quarter of 2022. Despite the challenges faced by the industry from shortages of supply during 2022, the value of new business provided by this market reached a record level of £40.7 billion in 2022, supported by higher underlying asset values.
“While the near-term outlook remains challenging, the UK avoided recession in Q4 2022, inflationary pressures have shown signs of easing, and the labour market remains robust. The FLA’s quarter one 2023 Industry Outlook Survey suggested that motor finance providers are more optimistic about the prospects for growth, with 52% expecting some increase in new business over the next year, up from 23% in quarter four 2022.
“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”
