News
January snow fails to freeze motor finance sales
The latest motor finance figures from the Finance & Leasing Association showed that the return of the 17.5% VAT rate and heavy snowfall impacted on sales in January, but consumer new car finance sales were up almost a quarter on last year
- Consumers bought 23% more new cars using motor finance through dealers in January than in January 2009. But January 2009 was a particularly weak month for consumer new car finance volumes.
- Consumer used car finance sales remain slow, with 19% fewer cars sold on dealer finance in January than the same period last year.
- The return to the higher VAT rate in January impacted on all car sales.
- Poor weather conditions meant that there were fewer customers visiting show rooms.
- Business new car finance sales were also down by 23%, showing that businesses continue to make their current vehicle fleets last longer instead of replacing them.
- Although down on last year’s highs, the motor finance market still accounts for over 45% of all private new car registrations.
Commenting on January’s motor finance figures, Geraldine Kilkelly, Head of Research and Chief Economist, said:
“While we have not seen the record new car finance growth levels witnessed in December, January was still a good month, up 23% on last year. The growth comes against abnormally low consumer new car finance sales in January of last year.
“The cold weather may have prevented consumers venturing out to car showrooms in January, and anyone thinking of purchasing a new car may have decided to wait for the ‘10’ number plate, released on 1 March.”
Table 1: Cars bought on finance by consumers through dealerships
| Jan 10 | % change | 3 months to Jan 2010 | % change | 12 months to Jan 2010 | % change | |
| New cars | ||||||
| Value of advances (£m) | 292 | +21 | 1,342 | +63 | 5,842 | -2 |
| Number of cars | 25,621 | +23 | 109,152 | +66 | 469,814 | -6 |
| Used cars | ||||||
| Value of advances (£m) | 405 | -8 | 1,198 | +1 | 5,455 | -12 |
| Number of cars | 43,357 | -19 | 125,292 | -8 | 601,706 | -12 |
Table 2: Cars bought on finance by businesses
| Jan 10 | % change | 3 months to Jan 2010 | % change | 12 months to Jan 2010 | % change | |
| New cars | ||||||
| Number of cars | 19,552 | -23 | 64,875 | -14 | 348,421 | -16 |
| Used cars | ||||||
| Number of cars | 4,467 | +6 | 12,331 | -6 | 47,235 | -14 |
- ends -
Note to editors:
1. See www.financingyourcar.org.uk for impartial information on finance options for buying a car.
2. The FLA is the leading trade association for the motor finance sector in the UK. In 2009 FLA members financed £72.5 billion of new business. FLA members provided £16.5 billion of motor finance in 2009 and financed more than 45% of all new car registrations in the UK.
For further media information, please contact:
Russell Hamblin-Boone, FLA
T: 020 7420 9656 E: russell.hamblin-boone@fla.org.uk M: 07810 374110
Helen Saxon, FLA
T: 020 7420 9664 E: helen.saxon@fla.org.uk M: 07918 766 993