The value of used cars sold on finance at the point of sales surged 34% in the February, March, April period, according to the latest figures from the Finance & Leasing Association.
But it warned that consumer spending on motors was expected to slow in the second half of the year as inflation and higher interest rates hit home.
Geraldine Kilkelly, director of research and Chief Economist at the FLA, said: “The consumer car finance market continues to be impacted by the global disruption to the supply of vehicles.
“The market reported further double-digit growth in the value of new business reflecting upward pressure on car prices, particularly in the used car market.
“Consumer spending is expected to slow as pressure builds on household incomes from higher inflation, interest rates, and taxes. Our latest research suggests that consumer car finance new business by value will grow by 11% in the first half of 2022 and by 5% in the second half of the year.
The consumer new car finance market reported new business up 4% by value and 1% by volume in April compared with the same month in 2021. In the first four months of 2022, new business volumes in this market were 5% higher than in the same period in 2021.
The consumer used car finance market reported new business up 17% by value, but 2% lower by volume in April compared with the same month in 2021. In the first four months of 2022, new business volumes in this market were 20% higher than in the same period in 2021.
“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”
| Table 1: Cars bought on finance by consumers through the point of sale | ||||||
| New business | Apr 2022 | %
change on prev. year |
3 months to Apr 2022 |
% change on prev. year | 12 months to Apr 2022 | % change on prev. year |
| New cars | ||||||
| Value of advances (£m) | 1,449 | 4 | 4,820 | 1 | 18,002 | 9 |
| Number of cars | 58,766 | 1 | 194,079 | -2 | 749,875 | 5 |
| Used cars | ||||||
| Value of advances (£m) | 2,048 | 17 | 6,318 | 34 | 22,253 | 27 |
| Number of cars | 128,176 | -2 | 402,056 | 13 | 1,511,004 | 14 |
| Total cars | ||||||
| Value of advances (£m) | 3,498 | 12 | 11,138 | 17 | 40,255 | 19 |
| Number of cars | 186,942 | -1 | 596,135 | 7 | 2,260,879 | 11 |
| Table 2: Cars bought on finance by businesses | ||||||
| New business | Apr 2022 | %
change on prev. year |
3
months to Apr 2022 |
% change on prev. year | 12 months to Apr 2022 | % change on prev. year |
| New cars | ||||||
| Number of cars | 23,660 | -20 | 68,514 | -12 | 291,196 | 7 |
| Used cars | ||||||
| Number of cars | 5,303 | -2 | 16,389 | 22 | 56,541 | 8 |