The auto finance market across the Atlantic looks strikingly similar to the one in the United States. Sales of sport utility vehicles are plummeting, lenders are scrutinizing dealer performance, and auto retailers are laying off employees.
Check out this sampling of items from the most recent issue of Motor Finance magazine:
• Parker’s Car Price Guide has reported “no demand” among used car buyers for petrol 4x4s, especially with V8 engines. Owners of 4x4s are said to be having difficulty entering part exchange schemes, dealers being unwilling to take on the fuel-hungry vehicles as their devaluation continues.
• Nonprime motor finance house British Credit Trust has cut its ties with a number of brokers that it deemed “underperforming.” BCT Chief Executive John Sinclair confirmed to Motor Finance that brokers who failed to deliver “the volume and the quality of business” that the finance house needs have had their relationships with BCT terminated.
• The U.K.’s largest car retailer Pendragon PLC has announced that it is to cut 500 jobs as a response to “difficult and competitive trading conditions.” The outlook for Pendragon in coming months looks gloomy if, as widely expected, the economy cools further and car sales continue to slip.
What remains to be seen is which lessor will be first to exit the market — or, better yet, how U.K. financiers solve their problems.
