UK Consumer Car Finance New Business Volumes Grew by 5% in June 2025
In the world of car finance, June 2025 has brought some heartening news! According to recent data from the Finance & Leasing Association (FLA), UK consumer car finance new business volumes grew by 5% compared to the same month in 2024. Let’s dive into the details and explore what this means for car buyers and the automotive market.
Understanding the Growth in Car Finance
New Car Finance Market Insights
- June Figures: New business volumes in the consumer new car finance market reported a growth of 5% and the value increased by 8% compared to June 2024. This is a promising sign showing that more people are looking to finance new vehicles.
- First Half of 2025: The first half of 2025 (H1 2025) saw new business volumes increase by 7% over the same period last year.
Used Car Finance Market Highlights
For the consumer used car finance market:
- June Growth: The value of new business in June increased by 9%, but volumes remained static with a 5% growth.
- Half-Year Performance: It’s interesting to note that new business volumes were 2% lower compared to the first half of 2024.
This demonstrates a subtle shift in consumer preferences, potentially favouring new cars over used ones.
Why This Matters for Consumers
Geraldine Kilkelly, the Director of Research at FLA, commented on the figures, noting that despite economic challenges, the consumer car finance market has demonstrated resilience. Here are some key takeaways:
- Market Size: The consumer car finance market is the largest segment of the UK consumer credit market, trailing only behind mortgages. This shows strong reliance on car finance among UK consumers.
- Support for Buyers: Over 6 million consumers across the UK leverage this market to fund their car purchases, highlighting its importance in everyday life.
Tips for Prospective Buyers
If you’re considering financing a car, here are some friendly tips:
- Research Your Options: Compare different financing plans and lenders to find the best deal.
- Stay Within Budget: Always remember to stay within a budget that suits your financial situation.
- Consult Your Lender: If you’re worried about keeping up with payments, reach out to your lender early. They may offer solutions!
Examples to Consider
- First-Time Buyers: If you’re a first-time buyer, consider opting for a Personal Contract Purchase (PCP) plan. It allows for lower monthly payments compared to traditional loans.
- Used Cars vs. New Cars: While the growth in new car finance is encouraging, it’s essential to weigh your options. Used cars can represent great value for money, especially with the current economic climate.
Frequently Asked Questions
1. What is consumer car finance?
Consumer car finance is a way for people to purchase vehicles through lender assistance, like loans or leasing.
2. How does financing a car work?
Typically, you choose a vehicle and apply for credit from a lender, agreeing to pay back the amount borrowed, usually with interest, over a specified period.
3. Why has car finance grown?
Factors include increasing consumer confidence, a wider selection of affordable vehicle options, and improved lending terms.
Conclusion: A Bright Future Ahead
The growth in UK consumer car finance new business volumes in June 2025 signals optimism in the automotive market. Whether you are a seasoned buyer or someone considering your first car, understanding these dynamics can help you make informed decisions. Always remember that the consumer finance landscape is there to assist you in getting behind the wheel of your dream car.
For more useful insights on car finance, be sure to check out this detailed guide on financing options.
As you embark on this journey, embrace the opportunities and stay informed! The road ahead may be filled with challenges, but with the right knowledge, you can navigate it smoothly. Happy car hunting!
For further reading, we recommend checking out the report by Motor Finance Online for deeper insights (nofollow).
