More than one in three (35%) dealers told cap hpi they expected used car finance penetration to be at least 50% in the next twelve months in a survey the information provider conducted.

Almost half of the 100 respondents (48%) said they expected finance penetration to be between 30% and 50%. 26% said they expected finance penetration to be between 50 and 70%, while 18% said they expected finance penetration to be below 30%. 

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Just 9% said they expected finance to be over 70%.

In contrast, car finance penetration for new cars reached 85% for the 12 months to May, according to the Finance & Leasing Association (FLA).

It was perhaps unsurprising that the dealers were more confident of higher penetration for new car finance.

43% of dealers expected new car finance penetration to remain between 70% and 80% for the next 12 months, while nearly a quarter (24%) predicted it would rise above 80%.

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Almost one in five (19%) said they thought new car finance penetration would fall to between 50% and 70%, while just 15% thought it would fall to below 50%.

Commenting on the finding, Philip Nothard, consumer and retail specialist at cap hpi said: “Finance is increasing as cash customers holding back. Feedback shows that performance is very franchise specific, and varies greatly between new and used. Late plate stock is difficult to move because of entry price to new and unrealistic support levels from manufacturers for demo cars, etc. Over age cars are becoming an issue as trade values not being realised at auctions and stock remaining unsold.