Consumer car finance new business volumes increase by 2%

17th May 2022

New figures released by the Finance & Leasing Association (FLA) show that the consumer car finance market reported new business volumes up in March 2022 by 2% compared with the same month in 2021. The corresponding value of new business grew by 8% over the same period. In Q1 2022 as a whole, new business volumes were 18% higher than in the same quarter in 2021.

The consumer new car finance market reported a fall in new business of 6% by value and 8% by volume in March compared with the same month in 2021. In Q1 2022 overall, new business volumes in this market were 6% higher than in the same quarter in 2021.

The consumer used car finance market reported new business up 31% by value and 10% by volume in March compared with the same month in 2021. In Q1 2022 overall, new business volumes in this market were 26% higher than in the same quarter in 2021.

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said “The slowdown in growth reported by the consumer car finance market in March was primarily driven by the adverse impact of supply shortages in the new car market. The consumer used car finance market remained buoyant reaching new heights in March as monthly new business surpassed £2 billion for the first time.”

“The UK economic outlook has weakened significantly because of the squeeze on household incomes and business profit margins from higher inflation. Pressure on household incomes this year and the ongoing vehicle supply issues mean the consumer car finance market is likely to record single-digit growth in the value of new business in 2022 overall.”

“As always, any customer worried about meeting payments should speak to their lender as soon as possible to find a solution.”

Table 1: Cars bought on finance by consumers through the point of sale

New business

Mar 2022

%

 change on prev. year

3
months to Mar 2022

% change on prev. year

12 months to Mar 2022

% change on prev. year

New cars

Value of advances (£m)

2,554

-6

4,635

9

17,892

19

Number of cars

102,352

-8

188,335

6

748,339

14

Used cars

Value of advances (£m)

2,195

31

6,011

48

21,182

35

Number of cars

136,315

10

381,746

26

1,439,458

21

Total cars

Value of advances (£m)

4,749

8

10,646

28

39,075

27

Number of cars

238,667

2

570,081

18

2,187,797

19

Table 2: Cars bought on finance by businesses

New business

Mar 2022

%

 change on prev.

year

3

months to Mar 2022

% change on prev. year

12 months to Mar 2022

% change on prev. year

New cars

Number of cars

30,521

-5

67,056

-4

298,685

17

Used cars

Number of cars

3,583

-23

18,658

60

55,942

1