Dealer finance 'increasingly used to buy new cars'

Date: 14/2/2012

An increasing number of people are purchasing cars using dealer finance, it has been revealed.

Research conducted by the Finance & Leasing Association showed 62.9 per cent of all new motors were bought using this type of funding in 2011.

This was nearly ten percentage points higher than the total recorded the previous year.

Many motorists also bought used cars with dealer finance, with 729,000 purchases being made in 2011 - four per cent higher than 2010's figure.

Head of Motor Finance at the Finance & Leasing Association Paul Harrison said flexible finance and value-for-money vehicles encouraged people to spend.

"Despite some of the gloomy headlines on retail confidence, in 2011 growth in the car finance market was driven by consumers," he added.

Last month, data from the Society of Motor Manufacturers and Traders showed demand for new cars totalled 1,941,253 units last year - higher than the forecast of 1.92 million.

Diesel and alternatively fuelled cars were found to have performed particularly well.

Posted by Mary Treen