Point of sale
car finance has plummeted in the last ten years, and is
suffering badly from a ‘weak image’ as an uncompetitive
financial service .
A study by BlackHorse Finance indicates that point of sale
vehicle finance for both used and
new cars has slumped. For independent
dealers,
used car finance penetration fell to 20 per cent between 1997
and 2006.
High street
bank finance, such as
personal loans, and
finance houses (both independent and
car manufacturers) have taken much of the market share
of vehicle finance .
Professor Peter Cooke was reported as commenting: Franchised
and non-franchised dealers may run the risk of losing car sales,
particularly in a period of tight
credit, if they do not promote PoS finance to private
car buyers . Dealers have lost a degree of independence. There
is a risk finance may increasingly come under the direct control of
manufacturers’ finance houses with their objective of selling
their own cars, and banks and
building societies where the agenda is
lending finance rather than tailoring a
loan to satisfy a would-be car buyer’s exact
requirements.
