More than £600 million in finance was provided in May allowing businesses to purchase 42,000 new cars. The latest figures from the Finance & Leasing Association show that the business new car finance sector grew 26% by value and 34% by volume in May compared with May 2011.
Operating leases are the most popular product in the business new car sector, accounting for more than half of all business written. However the value of new business in this sector financed through Hire Purchase (HP) deals was up 57% up compared with the previous May. The average amount advanced per new car was £14,362.
Over the last 12 months, the business new car market grew 9% up by volume, to almost 402,000.
The consumer new car finance market also grew in May, now accounting for 67.4% of all private new car sales. In May, £1.4 billion was advanced to consumers, enabling more than 122,000 people to purchase a car.
Paul Harrison, Head of Motor Finance at the Finance & Leasing Association, commented: “The business new and used car sectors showed exceptional growth in May, reflecting the good deals available.
“Many businesses operating vehicle fleets have turned to asset finance in recent years because it can free up other sources of finance for their day-to-day operating expenses. And because asset finance is usually secured against the vehicle, a business’s property and other assets are not at risk.”
For more information: www.fla.org.uk