Motor finance market booming despite new lockdown

The motor finance market has remained strong despite lockdown restrictions forcing car dealers to work online.

Startline Motor Finance reports that the amount of business it has written in January so far has exceeded the same period in 2020.

Furthermore, it saw its busiest single day for new proposals ever last week.

Paying with cash
Paying with cash

Car dealers have been forced to close during the latest national lockdown, but are still able to deliver vehicles that are ordered online or over the phone. Startline says it believes the dealers that have optimised their distance-selling operations over the past year are handling lockdown the best.

The company’s CEO Paul Burgess said: “We are starting to see reports that the overall used car market is about 50 per cent down but our experience is that different dealers are having very different experiences. Some are doing much better than others.

“Of course, there is the possibility that we are, so far, seeing some deals being written that are carried over from the pre-lockdown period but there are also strong anecdotal indications that people are continuing to buy used cars in number.

“Importantly, we believe that the quality of the online journey being created is becoming more important. Once a customer has decided to buy a car, the entire purchasing process including motor finance has to be as painless as possible. No-one wants to spend hours filling in online forms. Everything needs to be fast and slick.”

Burgess added that despite the positive start, it was difficult to predict what effect the remainder of the lockdown would have on the used car market, saying: “The question is whether consumer appetites for buying used cars will diminish and obviously the lockdown doesn’t help but the effects of the pandemic on the finances of individuals have, so far, been extremely variable. Some have been hit hard, others not at all.”