9:24 am, January 17, 2025
New business in the consumer car finance market fell in the penultimate month of last year, according to new data from the Finance & Leasing Association (FLA).
Data released this week shows that new business volumes fell in November 2024 by 2% compared with the same month in 2023.
While the results may appear to be a negative for the finance sector, the corresponding value of new business grew by 4% over the same period.
Throughout the 11 months of the year to November, new business was 2% lower by volume compared with the same period in 2023.
The consumer new car finance market reported new business by value in November 12% higher than in the same month in 2023, while new business volumes grew by 6%.
In the year-to-date up to November, new business volumes in the market were 3% lower than in the same period in 2023.
The consumer used car finance market reported a fall in the value of new business in November of 2% compared with the same month in 2023, while new business volumes decreased by 5%.
In the 11 months to November 2024, new business volumes in this market were 1% lower than in the same period in 2023.
Commenting on the figures, Geraldine Kilkelly, director of research and Chief Economist at the FLA, said: ‘The consumer car finance market in November reported a further modest fall in new business volumes.
‘The consumer new car finance sector returned a relatively strong growth performance which was offset by a single-digit contraction in the consumer used car finance sector.
‘We expect FLA consumer car finance new business to reach £38.9bn in 2024, a similar level to 2023. The outlook for 2025 remains challenging.
‘Despite the lower inflation and interest rate environment, continued pressure on real disposable incomes has hit consumer confidence and consumer spending.
‘FLA’s latest industry outlook survey suggested that over 40% of motor finance respondents expected some increase in new business over the next year.
‘As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.’
