The latest data from the UK Finance & Leasing Association (FLA) reveals a downward trend in the consumer car finance sector for August 2025.
A 5% decrease in new business volumes and a 1% decrease was reported in the overall value of new agreements, compared to the same month of the previous year.
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Despite the decline observed in August, the cumulative figures for the first eight months of 2025 remained relatively unchanged from the corresponding period in 2024.
Breaking down the figures, the consumer new car finance market saw a 1% reduction in the value of new business and a 3% decline in the number of new agreements in August 2025, compared with August 2024.
However, when considering the period from January to August 2025, there was a 6% increase in new business volumes over the same period in the previous year.
The consumer used-car finance market also reported a downturn in August 2025, with a 1% decrease in the value of new business and a 5% decrease in new business volumes when measured against August 2024.
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By GlobalDataOver the eight-month period to August 2025, this market experienced a 2% decrease in new business volumes year-on-year.
Commenting on the figures, FLA chief economist and research director Geraldine Kilkelly said: “The consumer car finance market reported modest contractions in new business in both the new and used-car finance sectors in August, which for the former is traditionally one of the quieter months of the year ahead of the issue of the September registration plate.
“Uncertainty about what the Autumn Budget will bring for households has contributed to a downturn in consumer confidence. The FLA’s Q3 [third-quarter] 2025 Industry Outlook Survey suggested that more than half of motor finance respondents expected consumer spending to decrease over the next year, while the proportion of respondents anticipating some increase in new business fell from 77% to 69% between Q2 and Q3 2025.
“As always, customers who are worried about meeting payments should speak to their lender as soon as possible to find a solution.”
In contrast, July 2025 showed a slight uptick in the sector, with a 1% rise in new business volumes and a 4% increase in the value of new business compared to July 2024.
