The fall in car sales volumes in January has
had a knock-on effect on volumes of motor finance, the Finance
& Leasing Association (FLA) reported.
In January 2009, 29 percent fewer new cars and
13 percent fewer used cars were purchased using point-of-sale
finance than in the same month in 2008.

However, the volume of new cars purchased using dealer finance
fell by less than the overall new car market, with the SMMT
recording a 30.9 percent drop in new registrations during the
month.

Levels of hire purchase also fell year on year, with 44 percent
fewer new and 30 percent fewer used cars financed on HP in January
2009.

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Consumer new car finance penetration stood at 53.1 percent.

“Leasing and personal contract purchase have proved more popular
over the past year, partly because consumers have less disposable
income and are uncertain about what the future holds,” said
Geraldine Kilkelly, chief economist and head of research at the
FLA.

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