Increase in car finance

By Joel Stanier - Financial specialist

The number of new cars bought on car finance grew by 49% in the three months to February, compared with the same period a year ago, according to the Finance and Leasing Association (FLA).

Car finance for used cars also grew, albeit only by 3%, over the same period. However, unlike new cars, the actual number of used vehicles sold fell in this time.

Paul Harrison, Head of Motor Finance at the FLA, said: "It is a sign of increased consumer confidence that both the new and used motor finance markets are up. We may well be seeing a return to a more settled car-buying pattern as Government incentive schemes come to an end."

"We expect growth to continue into March, particularly as many customers will have delayed buying a new car and waited for the release of the `10` registration plate. Many customers buying new cars will use their old car as part exchange, which could give a timely boost to the supply of used cars in the market over the next few months."

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