The consumer car finance sector has recorded modest growth in July 2024, with new business volumes rising by 1% compared to July 2023, according to new figures released by the Finance & Leasing Association (FLA).

This growth is reflected in the value of new business, which saw a 2% rise over the same period.

However, when looking at the seven months leading up to July 2024, there was a slight decrease in new business by value, down 2%, and by volume, down 3%, against the same period in the previous year.

The consumer new car finance market experienced a 5% increase in new business value in July 2024 compared to July 2023, despite a 3% drop in new business volumes.

Over the seven months to July 2024, this market’s new business volumes were 7% lower compared to the corresponding period in 2023.

The value of new business in the consumer used car finance market fell by 1% in July 2024 compared to the same month in 2023, while new business volumes increased by 3%.

For the seven months to July 2024, new business volumes decreased by 1% when compared with the same period in the previous year.

FLA research director and chief economist Geraldine Kilkelly said: “The consumer car finance market made a positive start to the third quarter of 2024 with modest growth in both the value and volume of new business in July.

“Consumers’ optimism about the outlook for their personal finances and committing to big-ticket purchases has greatly improved in recent months off the back of better news on inflation and interest rates. 

“We expect the value of new business overall in the consumer car finance market to be slightly lower in 2024 than in 2023, with growth of 1% in the consumer new car finance market offset by a 3% fall in the consumer used car finance market.”