In Q2, the value of new car finance increased by 38 per cent and the number of cars bought on finance by 27 per cent, compared with Q2 2011. More than £2.2bn was lent to consumers to fund the purchase of more than 155,000 cars.
FLA statistics show that PCPs remains the most popular product, accounting for 61 per cent of all consumer new car finance agreements.
Hire Purchase accounted for 26 per cent, and leasing for eight per cent of the market. Personal loans from motor dealers accounted for the rest
Over the last 12 months, 67.9 per cent of new cars bought by consumers were purchased using finance sold in car dealerships.
Paul Harrison, head of motor finance at the FLA, said: ’2012 has been a great year so far for motor finance providers, with the total market up by 18 per cent in Q2 and the new car finance market posting double digit growth every month this year.
‘The used car finance market fell for the first time in 12 months in June, but was still up over the quarter and the year. The small dip can probably be explained by the range of new car incentives available which have narrowed the price difference between new and used cars on forecourts.’