New car finance sales increase 15pc

Forecourt finance remains popular, with more than 36,000 people in May financing a new car in this way, according to figures published by the Finance & Leasing Association.

New car finance sales in May increased by 15pc compared to May 2009 and more than half of car buyers in May used dealer finance to fund their purchase, showing that the end of the scrappage scheme did not lead to the feared drop-off in the number of customers wanting to buy new cars. Business purchases of new cars on finance also grew by 21pc in May compared with a year earlier.
The latest figures also show that consumers are taking advantage of dealer finance to buy used cars in similar numbers to last year. More than 52,000 used cars were bought with the help of dealer finance in May.
Commenting on May’s motor finance figures, Paul Harrison, Head of Motor Finance, said:
“Dealers are offering value-for-money deals, which have kept customers coming through the doors. This has meant that the amount of dealer finance provided to consumers for new cars has grown by a fifth in the last 12 months compared with the previous 12-month period.
“The first half of the year has been encouraging for dealers. But we expect to see sales of new cars on finance drop off later in the year while used car finance sales will pick up as second-hand stock becomes more available.”