Fall in consumer car finance new business volumes

However new business in the 12 months up to January 2023 grew five percent by value and held steady by volume when compared to the same period in 2022.  

As for the used consumer car finance market, this reported new business volumes at a similar level to the same month in 2022, while the value of new business fell by four percent over the same period. In contrast, in the 12 months to January 2023 new business volumes grew by four percent when compared to the same period in 2022.  

Responding to these findings, the FLA’s chief economist and director of research Geraldine Kilkelly said: “The consumer car finance market reported a modest fall in new business in January.  

“In the first half of 2023, household expenditure is likely to remain relatively weak as pressures on household incomes from high inflation, and higher interest rates and taxes continue, but we should see a further easing of supply shortages in the new car market as the year progresses. 

“FLA’s latest research suggests that the value of consumer car finance new business is likely to contract by six percent in 2023 to £38bn. The value of new business provided to consumers for new car purchases is expected to grow by four percent in 2023 to £18bn, while consumer used car finance new business by value is forecast to fall by 12% in 2023 to £21bn.    

“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”