Car Leasing Proving Increasingly Popular With UK Drivers

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Wed, 17 Aug 2011

A growing number of UK motorists are abandoning car ownership in favour of hiring cars on long-term leases, the Finance and Leasing Association (FLA) has revealed.

New figures from FLA revealed that the value of private car leases rose by 55 per cent year-on-year in the second quarter of 2011, with more than £100 million granted to customers, compared with just £66 million in the same three-month period last year.

According to the data, dealer motor finance now accounts for 57 per cent of all new private car purchases and is also a popular option in the UK’s used car market. In 2010, a total of 500,000 new cars and 635,000 second hand cars were bought using motor finance.

Paul Harrison, Head of Motor Finance at the FLA, said: "Almost three out of five motorists buying a new car use dealer finance ."

"While personal contract purchase and hire-purchase deals remain popular, increasing numbers of people are turning to leasing as an affordable finance option."

"Traditionally, leasing has been more popular with businesses, but many manufacturers and independent finance companies are offering new and improved leasing options to private customers."

Harrison added: "If insurance and servicing are included, it can make financial sense to lease, particularly for motorists who like to change their car every few years."