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UK Used Car Finance: Market Insight Report 2019

  • ID: 4802177
  • Report
  • January 2019
  • Region: United Kingdom
  • 62 Pages
  • Apex Insight
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FEATURED COMPANIES

  • 1st Stop Car Finance
  • Billing Finance
  • First Response
  • Mann Island Finance
  • MotoNovo
  • Raphaels Bank
  • MORE

This report focuses on the UK market for secured consumer finance for used cars.

  • It also includes agreements for used motorcycles, vans and leisure vehicles (e.g. campervans) however cars represent over 95% of the relevant consumer market.
  • Secured loans are defined as those where the ownership of the vehicle rests with the lender during the life of the agreement.
  • The report excludes unsecured personal loans that some consumers may use when buying a car, which the author believes is now a relatively minor form of car finance.
  • It includes agreements for vehicles that might be used for business purposes by individuals but are purchased by consumers rather than the businesses they run.

The report:

  • Describes the overall used-vehicle market size and historical growth rates.
  • Profiles 25 largest used vehicle loan providers.
  • Describes the role of brokers, including firms working with vehicle dealers and those dealing directly with consumers.
  • Reviews drivers of used vehicle loan growth, setting out historical trends and available forecasts.
  • Provides our forecast for the market to 2021, supported by evidence from market drivers and industry interviews.

Objectives of the report
This report aims to get behind the publicly available high-level numbers on the number and value of car finance agreements arranged at POS to provide insight into the size and characteristics of the diverse range of lenders within this growing market

Key questions it answers include:

  • What are the different ways in which car dealer POS finance is offered in the UK?
  • What are the main types of used vehicle finance products?
  • How does the process of providing used vehicle loans vary between prime, near-prime and sub-prime customers?
  • Who are the main finance companies and what are their channels to market?
  • What is the role of brokers in the market?
  • What alternatives are there to secured loans for used vehicles?
  • How could new regulation change the market?
  • Taking these factors into account, how is the market expected to grow in the future?
Note: Product cover images may vary from those shown
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FEATURED COMPANIES

  • 1st Stop Car Finance
  • Billing Finance
  • First Response
  • Mann Island Finance
  • MotoNovo
  • Raphaels Bank
  • MORE

1. About this report

  • What does the report contain?
  • What are the objectives of this report?
  • Who is it useful for?
  • What are the sources and methodology?
  • Summary
  • The used car finance market
  • Market size and growth
  • Outlook
  • List of charts and tables

2. Used car finance market

  • Definition of the market
  • Types of finance offered to purchase cars
  • Hire Purchase
  • Personal Contract Plan (PCP)
  • Lease
  • Alternative products
  • Non-POS car loan
  • Personal loan
  • Mortgage further advance
  • Credit Card
  • Types of customers
  • Market size and growth
  • UK car market
  • Dealer sales
  • Franchised dealers
  • Independent dealers
  • Other vehicle distributors
  • Motor finance penetration
  • Motor finance volumes
  • Non-prime lending

3. Market Drivers

  • Regulatory landscape
  • FCA authorisation
  • Regulatory requirements
  • Recent regulatory developments
  • UK Economic performance
  • Consumer borrowing
  • Ability to service borrowing
  • Wages
  • Source: Bank of England Financial Stability Report November 2017
  • Other market drivers

4. Competitive landscape

  • Overview
  • Success factors in dealer POS finance
  • Market size and share
  • Sub-Prime sector
  • Split by channel

5. Major lenders

  • Barclays Partner Finance
  • Description
  • Activities
  • Black Horse (Lloyds Banking Group)
  • Description
  • Activities
  • Close Brothers Motor Finance
  • Description
  • Activities
  • Recent developments
  • Hitachi Capital
  • Description
  • Activities
  • Recent developments
  • MotoNovo
  • Description
  • Activities
  • Recent developments
  • Santander UK plc
  • Description
  • Activities
  • Recent developments
  • Other lenders
  • 1st Stop Car Finance
  • Description
  • Activities
  • Recent developments
  • Advantage Finance
  • Description
  • Activities
  • Recent developments
  • Alphera
  • Description
  • Activities
  • Billing Finance
  • Description
  • Activities
  • Recent developments
  • Blue Motor
  • Description
  • Activities
  • Recent developments
  • First Response
  • Description
  • Activities
  • Recent developments
  • JBR Capital
  • Description
  • Activities
  • Recent developments
  • Mallard Vehicle Finance
  • Description
  • Activities
  • Marsh
  • Description
  • Activities
  • Recent developments
  • Moneybarn
  • Description
  • Activities
  • Recent developments
  • Moneyway
  • Description
  • Activities
  • Recent developments
  • NIIB Group
  • Description
  • Activities
  • Recent developments
  • Oodle Financial Services
  • Description
  • Activities
  • Recent developments
  • Paragon
  • Description
  • Activities
  • Recent developments
  • Private & Commercial
  • Description
  • Activities
  • Recent developments
  • Raphaels Bank
  • Description
  • Activities
  • Recent developments
  • Startline
  • Description
  • Activities
  • Recent developments
  • The Car Finance Company
  • Description
  • Activities
  • Recent developments

6. Other funders

  • Admiral Loans
  • Car Finance Limited
  • Ratesetter

7. Car dealer finance brokers

  • Auto Union Finance
  • Creditas
  • DSG Financial Services
  • Eurodrive
  • Evolution Funding
  • Jigsaw Finance
  • Mann Island Finance
  • Motion Finance
  • Whichdeal Limited

8. Forecasts

  • Approach
  • Key driver forecasts
  • Economic growth
  • Interest rates
  • Amount of consumer debt
  • Unemployment and underemployment
  • Household disposable income and wages
  • Used car sales volume forecasts
  • New car sales volume
  • Used car sales volume
  • Our forecast scenario for used car sales volumes
  • Motor finance penetration
  • Regulatory impacts
  • Other drivers of finance penetration
  • Our forecast scenario for used car finance penetration levels
  • The forecast used car finance values

9. Appendix: Abbreviations

List of Exhibits

  • Market participants
  • Used vehicle new secured finance agreement volumes (Thousands): Actual and forecasts
  • Car parc (millions)
  • Car sales – volume (millions)
  • The average period between car sales/years
  • Dealer car sales – volume (millions)
  • Consumer vehicle finance penetration level – transactions financed as % of total
  • Total advances – volume / ‘000
  • Total new consumer POS advances – value / £bn
  • Key FCA regulatory requirements for car dealers
  • UK real GDP / % annual changes
  • UK outstanding unsecured consumer credit / £bn
  • Historical number of unemployed and underemployed / m
  • UK median earnings (current prices) and real household disposable income annual growth rates / % annual change
  • UK household debt to income ratio
  • Market participants
  • Breakdown of annual new lending
  • Volume and value of used cars finance in 2017 (millions and £ billions)
  • Clydesdale Financial Services Ltd. used vehicle secured finance net investment - £m
  • Lloyds Banking Group UK used vehicle secured finance net investment - £m
  • Close Brothers used vehicle finance net investment - £m
  • Hitachi Capital used vehicle net investment £m
  • MotoNovo UK used vehicle net investment £m
  • Santander Consumer Finance UK used vehicle net investment £m
  • 1st Stop Car Finance Limited Financials
  • Advantage Finance Limited Summary Financials
  • Billing Finance Limited Financials
  • Blue Auto Holdings Limited Financials
  • First Response Finance Limited Summary Financials
  • JBR Capital Limited Financial Summary
  • Mallard Leasing Ltd. Summary financials
  • Marsh Finance Ltd. Summary Financials
  • Moneybarn No. 1 Ltd. Summary Financials
  • Moneyway (Secure Trust Bank) Summary Financials
  • Oodle Financial Services Limited Summary Financials
  • Paragon Banking Group PLC Summary financials
  • PCF Bank Ltd. consumer finance division summary Financials
  • Startline Auto Receivables Ltd. and Startline Motor Finance Summary Financials
  • The Car Finance Company (2007) Limited Summary Financials
  • UK real GDP / annual changes
  • UK historical & forecast unsecured household debt / £bn
  • Unemployment and underemployment / m
  • Number of people in employment / m
  • UK median earnings (current prices) and real household disposable income annual growth rates / % annual change
  • Historical and forecast car sales – volume / £m
  • Historical and forecast used vehicle finance - volume ‘000
  • Historical and forecast used vehicle finance - £ billion
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Note: Product cover images may vary from those shown
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  • 1st Stop Car Finance
  • Advantage Finance
  • Alphera
  • Auto Union Finance
  • Barclays Partner Finance
  • Billing Finance
  • Black Horse (Lloyds Banking Group)
  • Blue Motor
  • Car dealer finance brokers
  • Close Brothers Motor Finance
  • Creditas
  • DSG Financial Services
  • European Vehicle Contracts (Eurodrive)
  • Evolution Funding
  • First Response
  • Hitachi Capital
  • JBR Capital
  • Jigsaw Finance
  • Mallard Vehicle Finance
  • Mann Island Finance
  • Marsh
  • Moneybarn
  • Moneyway
  • Motion Finance
  • MotoNovo
  • NIIB Group
  • Oodle Financial Services
  • Paragon
  • Private & Commercial
  • Raphaels Bank
  • Ratesetter
  • Santander UK plc
  • Startline
  • The Car Finance Company
  • Whichdeal Limited
Note: Product cover images may vary from those shown
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