6 August 2020
New figures released today by the Finance & Leasing Association (FLA) show that total asset finance new business (primarily leasing and hire purchase) fell by 41% in June 2020 compared with the same month in 2019. In the first half of 2020, new business fell by 32% compared with the same period in 2019.
The business new car finance and commercial vehicle finance sectors reported falls in new business in June 2020 of 55% and 44% respectively, compared with the same month in 2019. Over the same period, the business equipment finance and plant and machinery finance sectors reported falls in new business of 36% and 28% respectively.
Commenting on the figures, Geraldine Kilkelly, Head of Research and Chief Economist at the FLA, said:
“The asset finance market provided almost £2 billion of new business in June, up from a crisis-low of only £1.2 billion in May. The quarter end month of June is traditionally a strong month for the industry, and with many businesses closed or operating well below capacity, it is not surprising that new business was more than 40% lower than in June 2019.
“The outlook for the economy remains uncertain, with the industry facing a prolonged period of providing forbearance as a result of the crisis. We continue to urge the Government and Bank of England to take action that ensures support for all lenders, including non-bank lenders, so that they can meet the demand for forbearance and pent-up demand for finance to invest in new equipment.”
Jun 2020 |
% change on prev. year |
3 months to Jun 2020 |
% change on prev. year |
12 months to Jun 2020 |
% change on prev. year |
|
Total FLA asset finance (£m) |
1,989 |
-41 |
4,795 |
-49 |
29,715 |
-15 |
Total excluding high value (£m) |
1,840 |
-37 |
4,475 |
-49 |
27,672 |
-15 |
|
|
|
|
|
|
|
Data Extracts:
By asset: |
|
|
|
|
|
|
Plant and machinery finance (£m) |
452 |
-28 |
1,252 |
-34 |
6,363 |
-13 |
Commercial vehicle finance (£m) |
481 |
-44 |
1,077 |
-57 |
7,364 |
-20 |
IT equipment finance (£m) |
226 |
-14 |
547 |
-12 |
2,817 |
3 |
Business equipment finance (£m) |
119 |
-36 |
335 |
-40 |
2,038 |
-15 |
Car finance (£m) |
452 |
-51 |
1,026 |
-64 |
7,835 |
-21 |
Aircraft, ships and rolling stock finance (£m) |
31 |
-71 |
75 |
-62 |
415 |
-19 |
By channel: |
|
|
|
|
|
|
Direct finance (£m) |
814 |
-45 |
2,268 |
-49 |
13,704 |
-17 |
Broker-introduced finance (£m) |
398 |
-30 |
911 |
-48 |
5,772 |
-14 |
Sales finance (£m) |
628 |
-26 |
1,295 |
-48 |
8,196 |
-13 |
By product: |
|
|
|
|
|
|
Finance leasing (£m) |
268 |
-24 |
638 |
-40 |
3,743 |
-16 |
Operating leasing (£m) |
390 |
-33 |
761 |
-58 |
5,768 |
-17 |
Lease/Hire purchase (£m) |
1,001 |
-44 |
2,621 |
-50 |
15,844 |
-17 |
Other finance (£m) |
231 |
-38 |
630 |
-24 |
3,277 |
0 |
Note to editors:
- In 2019, FLA members provided £140 billion of new finance to UK businesses and households. £36 billion of finance was provided to businesses and the public sector. FLA members financed more than a third of UK investment in machinery, equipment and purchased software in the UK in 2019.
- For media enquiries, please contact the FLA press office on 020 7420 9656.