I know that Richard Brown (that guy from the diary page), and DSG managing director Richard Hoggart will be happy with this, as both men have wanted to write and to read, respectively, more content about the regions of the Kingdom.
So consider this the start of an on-going analysis of the UK, piece-by-piece. This month, we start with Q&A features dealing with lenders working in Northern Ireland and East Anglia. Broadening the theme, we take a look at finance for Mini, the German-owned but quintessentially British brand famous for its exploits in Italy, with the whole thing topped off with a pair of surveys into UK regional car-buying habits.
Go deeper with GlobalData
However, with all the flag-waving done with, and before we get too sunk into the UK, I’d like to take a cue from December’s Motor Finance and cast an eye over developments in the US.
Good news! The car finance market is huge in the States right now. Mortgages and credit cards may still be harder to obtain than gun licences but auto loans from banks totalled $47.5bn (£30.2bn) in Q1 2012 – a seven-year high – while non-bank lenders managed $52.5bn, a figure up 49% from the grim days of Q1, 2009. According to Experian, the value of the car loan market in the US stood at $725bn at the end of the second quarter of 2012, 5.7% up on a year ago, and at its highest for three years. Interestingly, the credit information provider also pointed out subprime car loan volumes were up 1%, with lenders drawn to the relatively shorter terms on car finance compared to mortgages, and attracted by the drop in overdue payment levels back to 2007 levels.
More good news! US consumers understand dealer finance. A survey by CarFinance.com, a subprime player from the States, found those already on finance were knowledgeable about re-financing automobiles, with respondents split an even three-ways on whether the greatest benefit of refinance was lowering monthly payments, reducing interest rates or paying off a loan sooner.
A third piece of good news! Both the understanding and marketing of retail finance are expected to continue at a high level in the US. A survey of 41 economists by Reuters at the end of July predicted retail incentive schemes would continue to drive increased car sales in the US. Indeed, Reuters reported, car funding deals could tap the demand pent up among people formerly priced out of purchases since the recession.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataFinally, an odd situation for GM, one of the daddies of Detroit and perhaps the most famous company bailed out by Presidents Bush and Obama, then Clint Eastwood during the Superbowl. The company has been spending $4bn a year on marketing (Clint and gridiron airtime aren’t inexpensive), generating only a 4% bump in sales, but is now looking to re-acquire GMAC / Ally Financial.
Could the purchase of an international captive finance operation do for GM what billions in advertising could not? Answers on a postcard from Detroit.
fred.crawley@vrlfinancialnews.com
