Find cheap personal car loans

Consumer car finance fell by 2% in July – Credit Connect

  • Emma
  • Car Finance

Estimated reading time: 4 minutes

Takeaways

  • In July 2026, consumer car finance new business volumes fell by 2% compared to July 2025, but year-to-date volumes rose by 3%.
  • The new car finance market saw growth of 10% in July, while the used car finance market faced an 8% decline in value.
  • Factors influencing these trends include consumer confidence, costs, and the availability of more affordable electric vehicles.
  • The FLA emphasized the need for steady policy support to boost consumer confidence ahead of the Autumn Budget.
  • Overall, despite declines in used car finance, the economy shows resilience through a growing new car finance market, according to Credit Connect.

New figures from the Finance & Leasing Association (FLA) show that consumer car finance new business volumes fell by 2% in July 2026 compared with the same month in 2025. The value of new business was unchanged.

In the first seven months of 2026, new business volumes rose by 3% compared with the same period in 2025.

Summary

These consumer credit figures show a mixed picture for car finance in July 2026. Volumes dipped a little from July 2025, but the market was still ahead for the year to date.

New car finance grew strongly, while used car finance weakened.

The FLA linked these trends to:

  • Consumer confidence
  • Costs
  • The wider supply of lower-cost electric vehicles
  • The need for steady policy support ahead of the Autumn Budget

Consumer new car finance market

The consumer new car finance market reported new business up 10% by value and volume in July compared with the same month in 2025.

In the first seven months of 2026, new business volumes in this market were 16% higher than in the same period in 2025.

Consumer used car finance market

The consumer used car finance market reported a fall in new business of 8% by value and 7% by volume in July, compared with the same month in 2025.

In the first seven months of 2026, new business volumes in this market were 3% lower than in the same period in 2025.

accepted for new car finance|

FLA commentary

Commenting on the figures, Geraldine Kilkelly, Director of Research and Chief Economist at the FLA, said:

July’s figures show a consumer car finance market that is still resilient. Overall volumes were a little lower than a year ago, but the market kept growing in 2026, with volumes up 3% so far this year.

Strong growth in newcar finance suggests that consumers still make big purchases when confidence and costs allow. The growing supply of cheaper new battery electric vehicles is also likely to be shaping buying choices. It may be pushing some consumers to choose new cars rather than used cars , which is adding to weaker demand in the usedcar finance market.

These trends point to an economy that is still growing, though only modestly. Ahead of the Autumn Budget, the Government should focus on steps that build consumer confidence, support investment and help it meet its net zero goals. A stable policy setting that makes it easier for households and businesses to plan and invest will support steady growth across the economy.

Source:

Credit Connect Think Tank

Q&A

Question: What was the overall trend in consumer car finance in July 2026?

Consumer car finance new business volumes fell by 2% compared with July 2025, while the value of new business was unchanged. Year to date, volumes were up 3% in the first seven months of 2026 compared with the same period in 2025.

Question: How did new car finance perform compared with used car finance?

New car finance grew strongly, with both value and volume up 10% in July year on year, and volumes up 16% across the first seven months of 2026. Used car finance weakened, with value down 8% and volume down 7% in July, while year-to-date volumes were 3% lower than in the same period in 2025.

Question: Why might demand for used car finance have weakened?

The FLA said the wider supply of more affordable new battery electric vehicles may be encouraging some consumers to choose new cars rather than used cars. This shift, along with wider factors such as consumer confidence and costs, may be helping to soften demand in the used car finance market.

Question: What policy support did the FLA say was needed ahead of the Autumn Budget?

The FLA said the Government should focus on steps that build consumer confidence, support investment and help meet net zero goals. It also stressed the value of a stable policy setting so households and businesses can plan and invest more easily.

Question: What does the FLA commentary suggest about the wider economy?

The FLA commentary suggests the economy is still growing, but at a modest pace. The resilience of the consumer car finance market, especially growth in new car finance, shows that consumers are still willing to make major purchases when confidence and costs are supportive.

References

Cars on finance bought by consumers through the point of sale

  • Change on previous year

Cars on finance bought by businesses

  • Change on previous year
  • Months to July 2026

Source: Credit Connect Think Tank

Related links: