April Sees 21% Surge in New Car Finance Volumes Amidst Market Expansion

Consumer car finance volumes increased by 3% in April, driven by robust demand for new vehicles that outweighed a decline in used car financing activity.

Data from the Finance & Leasing Association (FLA) revealed a 9% year-on-year rise in the value of consumer car finance new business in April, with volumes climbing 3% compared to the previous year.

The growth was primarily attributed to the new car sector, which saw finance volumes jump 21% and the value of advances grow by 25% versus April 2025.

A total of 53,381 new cars were financed through point-of-sale consumer agreements in April, while used car financing accounted for 118,317 units.

For the first four months of 2026, new car finance volumes rose 16% year-on-year, and overall consumer car finance volumes increased by 4%.

Used car finance volumes decline by 3%

Meanwhile, the used car finance market continued to face challenges.

The value of new business in the used car sector fell 2% in April, with volumes dropping 3% to 118,317 units. Over the four-month period, used car finance volumes were 2% lower than the same timeframe in 2025.

The FLA noted a positive start to Q2 for the market, despite persistent economic headwinds.

Geraldine Kilkelly, director of research and chief economist at the FLA, stated: “The consumer car finance market made a positive start to the second quarter of 2026, driven by strong growth in new car finance.

“In the near term, the backdrop remains challenging, with cost pressures, weak confidence and higher interest rates weighing on activity.”

Kilkelly highlighted that the recent US-Iran agreement has introduced greater stability to energy markets, improving the medium-term outlook for growth and inflation.

She added: “Looking ahead, there are clear opportunities for the motor finance market, particularly in the continued expansion of new and used electric vehicle markets.

“FLA members will play a central role in supporting this transition, enabling access to newer, more efficient vehicles and supporting mobility across the UK.”

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