The figures reveal that, for personal lenders, hire purchase
(HP) agreements are still the preferred finance product. However,
the incidence of voluntary termination remains high in the industry
and the steady move away from HP has continued – especially in the
second and third quarters of 2008. While conditional sale (volumes
down 1.4 per cent YTD compared with the same period in 2007) and
credit sale (down 17 per cent) slowly lose their popularity, PCP,
with its powerful customer-retention appeal, is likely to be the
finance product of the immediate future, with 12.2 per cent growth
YTD.

The number of businesses that register their vehicles with
Experian is not exhaustive but clearly reveal that finance leasing
is losing ground (down 0.4 per cent year-on-year) whilst contract
hire (CH), up 5.9 per cent, has maintained its attractiveness
throughout the year. The sudden 26.2 per cent fall in volume in CH
agreements this July is likely to be a result of the current
economic downturn and will probably continue towards the end of the
year.

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Dealers choosing unit stocking as a funding source have grown
volumes by some 7.3 per cent so far this year – a figure that is
likely to increase further if bank lines dry up. Similarly,
demonstrator stocking has shown significant growth in June (up 34.5
per cent) and July (up 33.4 per cent) although with the current
downturn in showroom traffic future take-up levels of this product
may vary.