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Motor finance still in doldrums

The latest figures from the motor lending sector point to a continuing slow down in demand for point-of-sale finance. The Finance and Leasing Association's Early Indicator figures for October show that consumer demand for motor finance dipped by 2 per cent. But strong growth earlier in the year means that overall the year-to-date figure is still up by a 16 per cent.

But while private buyers seem to have eased back, businesses appear to be buying new cars again. Business demand for finance was up by 9 per cent on October last year. Year to date demand is up by 6 per cent.

Overall the demand for new car finance is up by 3 per cent on October 2001 but the number of vehicles financed fell by 1 per cent, which mirrors the SMMT figure for new car registrations, which reported a 1 per cent decrease compared to October 2001.

Overall demand for used cars was up by 14 per cent compared to October last year, with consumer up by 13 per cent and business up by a healthy 22 per cent.

FLA Director General Martin Hall says: “Consumer demand this year for new cars has been a great success story for the industry, a tribute to the competitiveness of manufacturers and the finance deals that support them. But it was running at such a high level that it was inevitably going to ease back at some point.

“The good news this month is that at long last the business car sector is picking up and our members are reporting strong growth. The hope is that this reflects more business confidence, rather than deferred replacement of vehicles.” For more details on the FLA website here

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