As the new ’15’ car registration plates are launched, John Simpson, managing director at car finance provider Moneyway, discusses the expected car sales trends for the coming year


Every year, the release of the newest car number plates has very much the same effect as the launch of the latest gadget – an increase in sales. In order to ensure these luxury purchases remain affordable to the most individuals, car finance is set to continue its upward trajectory this year.

In particular, the launch of the ’15’ car registration plates is going to lead to strong sales figures. With economic indicators indicating a period of unprecedented growth in 2014 and a projected further period of stability during the election year, now is a good time to buy a new or used car. Motor finance providers have widely rediscovered their appetite to lend, while consumers have access to greater disposable income.

Political timings are also set to favour the automotive industry. With the General Election just round the corner, there’s expected to be little movement in interest rates until 2016. Not only does this mean that consumers can take out credit with more confidence as interest rates remain fixed and living expenses remain consistent, but motorists can budget more effectively and so may be able to acquire high-value items like a car.

2014 was a really strong year for the automotive industry, with new car sales reaching almost 2.5 million units – the fourth-largest figure recorded in a single year. Sales peaked due to a build up of demand throughout the recession, and we expect sales to remain stable in 2015, with a 1.2% growth figure being predicted.

One segment that saw notable uptake last year was electric and hybrid cars, as consumers show greater concern for fuel economy. Despite lower fuel prices at present, there’s no indication that more efficient cars will be less popular this year. In particular, the sale of ultra-low emissions vehicles (ULEVs) is expected to continue growing at a fast rate, with an increasing choice available.

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As well as this, the ever-advancing technology is set to play a greater role this year. With widespread reports of autonomous car tests, consumers are now more attracted to cars with the latest gadgetry. This has been illustrated by Volvo’s launch of its vehicle-to-vehicle communications system, which will provide real-time warnings to drivers about adverse weather conditions and disabled vehicles on the road ahead. With these advances inevitably increasing costs, customers may consider finance to acquire cars with the latest technology.

Another important impact on sales this year will be the changes brought about by FCA regulation. Finance providers will continue to focus on providing consumers with appropriate, transparent funding options that are both affordable for the customer and sustainable, aiming to give consumers more confidence in their purchase .

These rules should ensure a clear and consistent approach to customers’ financial options and requirements, taking away any mystery or confusion about motor finance. This will give motorists even greater confidence to obtain credit at point of sale, boosting activity for car dealers. With new entrants joining the market, creating healthy competition, there is even greater choice for consumers In excess of 76% of the new car market is already funded at point of sale, and with an increase of vehicle sales projected for 2015, we expect point of sale finance to continue to grow to satisfy consumer demand and needs.

In response to the changes in the market, Moneyway has been exploring more innovative ways to cater for a wider range of motorists. Motor finance products are becoming more tailored to specific customers and their needs, and our ‘rate for risk’ approach is a good example of how Moneyway can provide a product for most customer circumstances. We are also increasing the maximum advance available to our customers, offering larger loans across the entire risk curve to cater for the prime as well as the non-prime customers.

The future looks bright for both the automotive industry and car finance providers, and the release of the latest registration plates will drive further growth. The strength of the market is prompting lenders to increase their risk appetite in order to stay ahead of their competitors, leading to further sales of both new and used cars. With numerous developments expected to have an impact in the automotive sector this year, Moneyway is continuing to evolve its policies in its attempt to become a ‘one stop shop’ for subprime through to prime motor finance.