All articles by Fred Crawley
Fred Crawley
Broker sees direct-to-consumer sales soar
While the administration of online car retailer Autoquake has set back industry confidence in the potential for web-based car sales, specialist online finance broker Carloan4u thinks there has never been a better time to sell car finance online. The introducer, which gets consumers approved for finance before giving them the option to browse its dealer partners stocks online, has seen sales volume grow so fast in the last year that it is having to move into new offices in order to recruit more staff.
Rates stay low but cost of funding rises
Despite the Bank of Englands (BoE) decision in March to keep interest rates low, funding costs for motor finance providers have been on the rise since February, as markets brace themselves for seemingly inevitable rate rises.
Reaction to ‘motorists’ budget’
The motor finance and fleet industries have had a broadly positive reaction to the 2011 budget announcement, although many are sceptical about the long-term benefits their customers will derive from the so-called ‘motorists budget’ As expected, the Chancellor has abandoned Aprils 1p increase in fuel duty, but surprised everyone by delaying the inflation increase until next year and in fact reducing duty by 1p
Sutton warns of regulation shake-up
In an address to this years Finance and Leasing Association (FLA) dinner, Black Horse managing director and FLA chairman Chris Sutton warned recent implementation of the Consumer Credit Directive would be only the first in a series of regulatory hurdles for the motor finance industry to tackle. Sutton continued to explain that the upcoming transfer of regulatory responsibility from the Office of Fair Trading to the new Financial Conduct Authority (which will replace the FSA), would be just the beginning of “the biggest shake-up in consumer credit regulation for a generation”.
Car lenders feel more PPI heat from FOS
While motor finance companies are seeing fewer customers resort to the Financial Ombudsman Service (FOS) to settle grievances about car finance agreements, the number of complaints related to payment protection insurance (PPI) continues to climb on the back of relentless action by claims firms. PPI complaints made up 50% of all issues forwarded to the FOS in the years final quarter, up from 45% in the third quarter of 2010 and 34% in the second quarter, the first quarter in which the FOS began publishing complaint figures by product association.
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Diversity behind strength of UK car finance
The UK motor finance industry achieved a 5.1% greater annual lend in 2010 than in 2006, according to data published by market research company Finaccord. The report, Automotive Finance and Leasing for Consumers in Europe, highlights the resilience of British motor finance compared to the industries of other countries.
Editor’s letter: Keep ’em coming back for more
After years of upheaval in the point of sale business, it seems dealers finally need motor finance companies as much as the lenders need dealers. Car finance has come a long, long way from being just a vehicle for commissions in fact, it is now one of the best tools dealers have for staying afloat in an extremely turbulent consumer market.
Round table: Engine of growth
Motor Finance brought a number of experts together for a round table to talk about the potential for point of sale finance and its role in helping the industry prosper. This month, Motor Finance, in collaboration with Frontline Solutions, invited a collection of point of sale experts to attend the first of 12 round table discussions on the future of the dealer finance market.
Supermarket giants ready to sweep into UK car finance?
Following its reputed upcoming entry into the UK used car market, Tesco is understood to be planning a suite of car finance offerings to complement personal loans from Tesco Bank with rival Sainsburys possibly not far behind. The news emerged at an asset finance seminar held by the National Association of Commercial Finance Brokers on 1 March, where business leaders from two major UK lenders stated that they knew of the supermarket giants intentions to move into the car finance market.
Experts highlight the need for dealers to go online
Despite the demise of Autoquake casting doubt on the viability of web-based car selling, industry experts are highlighting the ability to sell cars and finance online as the greatest opportunity facing the automotive retail sector in 2011. At the most recent round table discussion held by Motor Finance and Frontline Solutions, commentators from finance houses, technology providers and credit information bureaus argued that the inability of many dealers to carry out business online was one of the industrys greatest weaknesses.