Highlights
New business volumes of FLA
business finance members were materially lower than in October – 25
percent down month-on-month for the market, excluding big ticket,
and 20 percent down on a year-on-year basis.
Go deeper with GlobalData
Big ticket volumes were up 49
percent on the previous month when figures were particularly
low.
Consumer finance, the first to show
signs of weakness going into the recession, was up on both a
monthly and annual basis.
This was driven largely by consumer
motor finance, which was up 51 percent on a year-on-year basis.
Business motor finance, by contrast,
was down 13 percent over the same period.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataThe car scrappage scheme accounted
for 22 percent of all new car registrations in November, in total
exceeding 250,000 since the programme began.
The demise of the big ticket market
in 2009 has been rapid and severe across the sector, despite having
continued to grow throughout 2008 (six of the last seven months of
2008 showed year-on-year growth in this market).
The fall in 2009 – combined with
longer sales cycles – may result in big ticket being the last to
come out of the current downturn. The big ticket market highlights
how different parts of the asset finance market have been affected
at different times in the downturn.
Looking at the November year-to-date
(YTD) volume by asset class over the past three years, some
interesting patterns begin to emerge.
The business car market dipped
slightly in 2008, but has fallen more sharply (26 percent) in
2009.
A similar pattern emerges for
commercial vehicles, business equipment and IT equipment – to some
extent, all generic assets that will follow the overall pattern of
the market.
Of the four, IT equipment has fared
slightly better, perhaps a function of the ongoing requirement for
slightly faster IT replacement programmes and, in some cases, a
lower entry point for that decision to be made.
Plant and machinery has followed a
different pattern. New business volumes continued to grow in 2008,
with the decline in 2009 much steeper.
This is characterised by November’s
monthly volume figure which, at £177 million (€201 million), was
the lowest for some years as well as being 55 percent down on the
same period last year.
YTD plant and machinery volumes were
45 percent down on 2008.
Monthly commercial vehicle new
business volumes in November were down only 11 percent on the
previous year and, backed by stabilising registrations in the van
sector (0.8 percent down), suggested some form of levelling off may
occur in the near future.
Not surprisingly, truck
registrations were weaker and seem likely to lag van sales
performance in 2010.
The SMMT also predicts that having
been slow into the downturn, bus and coach registrations will be
weak in 2010, lagging recovery in other asset classes.
Comment
While it is hard to be too
optimistic following November’s volumes – that continue to show
decline in new business volumes – there are some glimmers of hope
across the industry as economies begin to emerge from the downturn.
As the speed of recovery varies across the market, finance
providers with the ability to target early growth segments may
enjoy improvements fairly soon.
The author is a partner at the
consulting and services firm Invigors, and can be contacted
at peter.hunt@invigors.com
