Consumer car finance market fell in both value and volume in October, says FLA

  • New figures from Finance & Leasing Association show October car finance market dropped
  • Falls were one per cent in value and 11 per cent in volume
  • New car finance market saw the largest declines

Time 11:13 am, December 9, 2021

The consumer car finance market dropped in October, new figures show.

Data from the Finance & Leasing Association (FLA) show new business fell by only one per cent by value, but 11 per cent by volume in October compared to the same month last year.

However, in the 10 months to October 2021, new business volumes were seven per cent higher than in the same period in 2020.

In the new car finance market the drops were greater, with the FLA reporting an eight per cent fall in value and 13 per cent by volume compared with October 2020.

In the 10 months to October 2021, new business volumes in this market were four per cent higher than in the same period in 2020.

Some 93 per cent of new car sales were financed by FLA members in October – a ‘similar level’ to 2020, reported the organisation.

Meanwhile, in the used car market, new business was up by four per cent in value but down 10 per cent in volume. In the 10 months to October, new business volumes in this market were nine per cent higher than in the same period in 2020.

Geraldine Kilkelly, director of research and chief economist at the FLA, said: ‘The latest consumer car finance market data reflects the ongoing supply shortages of new and used cars.

‘The average advance to consumers for used car purchases reached £15,000 in October as high demand combined with supply pressures saw used car prices grow by almost 23 per cent during the same period.’

She added: ‘The car finance market was quick to recover as the economy opened up, with the value of annual new business in the consumer used car finance market in October only one per cent below the pre-pandemic peak.

‘However, the pace of recovery has been hampered by supply shortages which are likely to persist into 2022 as countries across the world contend with new waves and variants of Covid-19.’

James Batchelor's avatar

James – or Batch as he’s known – started at Car Dealer in 2010, first as the work experience boy, eventually becoming editor in 2013. He worked for Auto Express as editor-at-large and was the face of Carbuyer’s YouTube reviews. In 2020, he went freelance and now writes for a number of national titles and contributes regularly to Car Dealer. In October 2021 he became Car Dealer's associate editor.

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