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United Kingdom Car Loan Market Size, Share, Growth, Report: By Vehicle Type: Passenger Vehicle, Commercial Vehicle; By Ownership: New Vehicle, Used Vehicle; By Loan Provider: Banks, OEM, NBFCs; By End User: Individual, Enterprise; Market Dynamics: SWOT Analysis, Porter’s Five Forces Analysis; Competitive Landscape; 2024-2032
United Kingdom Car Loan Market Outlook
The United Kingdom car loan market size reached approximately USD 62.48 billion in 2023. The market is projected to grow at a CAGR of 6.4% between 2024 and 2032, reaching a value of around USD 109.20 billion by 2032.
Key Takeaways
- 2.1 million cars were financed by all the existing loan providers in 2021 in the UK.
- The average amount spent by Britishers on new car purchases was 25000 pounds.
- Automotive financing companies suggested that car loan financing could be used to purchase 23 billion pounds worth of used vehicles in 2023.
Car loans are a financial offering provided by banking companies and government institutions to enable consumers to purchase their vehicle without paying the full price at the time of transfer of ownership. Instead, consumers pay the principal amount of the price along with the interest rate on the loan in periodic installments and gain ownership rights on the vehicle upon completion of the price payment.
The market is being driven by soaring prices of second-hand vehicles and the increasing launches of new vehicles in the UK. With rising inflation, banks are focusing on encouraging consumer savings by putting forth simple terms and conditions for acquiring loans, which is leading to the United Kingdom car loan market development.
Key Trends and Developments
Greater preference for used vehicles; availability of multiple car loan financing options; the switch towards the adoption of four-wheelers; and ease of online loan payment are the major trends impacting the United Kingdom car loan market growth.
| Date | News |
| Jan 16th 2024 | London-based D2C car finance platform, Carmoola, raised £15.5 million equity investment to revolutionise the United Kingdom car finance market. |
| Sept. 25th 2023 | Fitch Solutions reported that the demand for vehicles in the UK would remain robust through 2024. |
| Jan 23rd 2023 | Metro Bank launched a digital car loan product under its RateSetter brand to offer an end-to-end digital experience to brokers and borrowers and enter the thriving UK vehicle financing market. |
| Sept. 30th 2022 | Lloyds Bank plc provided a loan of 1 million pounds to Lex Autolease and Black Horse for manufacturing electric vehicles. |
| Trends | Details |
| Greater preference for used vehicles | Britishers are three times more likely to purchase a used car over a brand-new vehicle, especially true for the younger population (aged 18-24 years). |
| Availability of multiple car loan financing options | Britishers typically enter into a hire purchase agreement or take a personal/guarantor loan to finance their vehicle purchase, among other options. |
| British motorists are switching towards the adoption of four-wheelers | Nearly half of all bike owners are planning to purchase their own vehicle in a few years in the United Kingdom. |
| Online loan payment services offered by banks | The increased convenience and flexibility associated with online payment of car loans are expected to boost the market growth. |
United Kingdom Car Loan Market Trends
Personal contract purchase and personal contract hire are some car loan financing options that British consumers choose to finance their new/used vehicle purchases. According to the Financing and Leasing Association of the UK, the demand for car leasing reached a value of 2.33 billion pounds in 2022 and recorded a year-on-year growth of 28% from November 2021. This growth in the popularity of car leasing as a financing option is expected to contribute to the United Kingdom car loan market growth.
The proliferation of digital banking services has contributed to the popularity of car loan financing in the UK. Consumers can gain information about car policies, interest rates, and installment sizes online, which facilitates their decision-making process about vehicle purchases. The ease and high speed associated with making online payments for car loans is also impacting the United Kingdom car loan market demand favourably.
Market Segmentation
“United Kingdom Car Loan Market Report and Forecast 2024-2032” offers a detailed analysis of the market based on the following segments:
| Market Breakup | Category |
| Vehicle Type | Passenger Vehicle, Commercial Vehicle |
| Ownership | New Vehicle, Used Vehicle |
| Loan Provider | Banks, OEM, NBFCs |
| End User | Individual, Enterprise |
Individuals are expected to dominate the United Kingdom car loan market share over the forecast period
Individuals are expected to constitute a major market share in the coming years. The younger population of the UK is inclined towards the purchase of used and inexpensive cars, which are older than 5 years. Besides, motorcyclists and bike riders are expected to make a transition to four-wheelers, which is expected to lead to the United Kingdom car loan market expansion in the coming years.
With the emergence of the UK as an attractive destination for doing business and the expansion of its warehousing and logistics industry, the demand for commercial vehicle financing is also expected to register a significant growth in the coming years.
Competitive Landscape
Major market players are focusing on designing fair terms and conditions for loan seekers in the UK
| Bank Name | Year of Incorporation | Location | Services |
| Barclays PLC | 1690 | London, United Kingdom | Consumer banking, corporate banking, and investment banking |
| BNP Paribas S.A. | 2000 | Paris, France | Retail Banking & Services, and Corporate Institutional Banking |
| Santander UK plc | 1988 | London, United Kingdom | Retail banking, and corporate and commercial banking, along with investment banking services |
| Lloyds Bank plc | 1765 | London, United Kingdom | Wide range of financial services for commercial and retail consumers |
Other players in the United Kingdom car loan market include Bayerische Motoren Werke AG (ALPHERA Financial Services), JBR Capital Ltd., Close Brothers Group plc, Tandem Bank Limited, Royal Bank of Scotland plc, and Nationwide Building Society, among others.
Key Highlights of the Report
| REPORT FEATURES | DETAILS |
| Base Year | 2023 |
| Historical Period | 2018-2023 |
| Forecast Period | 2024-2032 |
| Scope of the Report |
Historical and Forecast Trends, Industry Drivers and Constraints, Historical and Forecast Market Analysis by Segment:
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| Breakup by Vehicle Type |
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| Breakup by Ownership |
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| Breakup by Loan Provider |
|
| Breakup by End User |
|
| Market Dynamics |
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| Competitive Landscape |
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| Companies Covered |
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*At Expert Market Research, we strive to always give you current and accurate information. The numbers depicted in the description are indicative and may differ from the actual numbers in the final EMR report.
1 Preface
2 Report Coverage – Key Segmentation and Scope
3 Report Description
3.1 Market Definition and Outlook
3.2 Properties and Applications
3.3 Market Analysis
3.4 Key Players
4 Key Assumptions
5 Executive Summary
5.1 Overview
5.2 Key Drivers
5.3 Key Developments
5.4 Competitive Structure
5.5 Key Industrial Trends
6 Market Snapshot
7 Opportunities and Challenges in the Market
8 Europe Car Loan Market Overview
8.1 Key Industry Highlights
8.2 Europe Car Loan Historical Market (2018-2023)
8.3 Europe Car Loan Market Forecast (2024-2032)
9 United Kingdom Car Loan Market Overview
9.1 Key Industry Highlights
9.2 United Kingdom Car Loan Historical Market (2018-2023)
9.3 United Kingdom Car Loan Market Forecast (2024-2032)
10 United Kingdom Car Loan Market by Vehicle Type
10.1 Passenger Vehicle
10.1.1 Historical Trend (2018-2023)
10.1.2 Forecast Trend (2024-2032)
10.2 Commercial Vehicle
10.2.1 Historical Trend (2018-2023)
10.2.2 Forecast Trend (2024-2032)
11 United Kingdom Car Loan Market by Ownership
11.1 New Vehicle
11.1.1 Historical Trend (2018-2023)
11.1.2 Forecast Trend (2024-2032)
11.2 Used Vehicle
11.2.1 Historical Trend (2018-2023)
11.2.2 Forecast Trend (2024-2032)
12 United Kingdom Car Loan Market by Loan Provider
12.1 Banks
12.1.1 Historical Trend (2018-2023)
12.1.2 Forecast Trend (2024-2032)
12.2 OEM
12.2.1 Historical Trend (2018-2023)
12.2.2 Forecast Trend (2024-2032)
12.3 NBFCs
12.3.1 Historical Trend (2018-2023)
12.3.2 Forecast Trend (2024-2032)
13 United Kingdom Car Loan Market by End User
13.1 Individual
13.1.1 Historical Trend (2018-2023)
13.1.2 Forecast Trend (2024-2032)
13.2 Enterprise
13.2.1 Historical Trend (2018-2023)
13.2.2 Forecast Trend (2024-2032)
14 Market Dynamics
14.1 SWOT Analysis
14.1.1 Strengths
14.1.2 Weaknesses
14.1.3 Opportunities
14.1.4 Threats
14.2 Porter’s Five Forces Analysis
14.2.1 Supplier’s Power
14.2.2 Buyer’s Power
14.2.3 Threat of New Entrants
14.2.4 Degree of Rivalry
14.2.5 Threat of Substitutes
14.3 Key Indicators for Demand
14.4 Key Indicators for Price
15 Competitive Landscape
15.1 Market Structure
15.2 Company Profiles
15.2.1 Barclays PLC
15.2.1.1 Company Overview
15.2.1.2 Product Portfolio
15.2.1.3 Demographic Reach and Achievements
15.2.1.4 Certifications
15.2.2 BNP Paribas S.A.
15.2.2.1 Company Overview
15.2.2.2 Product Portfolio
15.2.2.3 Demographic Reach and Achievements
15.2.2.4 Certifications
15.2.3 Bayerische Motoren Werke AG (ALPHERA Financial Services)
15.2.3.1 Company Overview
15.2.3.2 Product Portfolio
15.2.3.3 Demographic Reach and Achievements
15.2.3.4 Certifications
15.2.4 Santander UK plc
15.2.4.1 Company Overview
15.2.4.2 Product Portfolio
15.2.4.3 Demographic Reach and Achievements
15.2.4.4 Certifications
15.2.5 Lloyds Bank plc
15.2.5.1 Company Overview
15.2.5.2 Product Portfolio
15.2.5.3 Demographic Reach and Achievements
15.2.5.4 Certifications
15.2.6 JBR Capital Ltd.
15.2.6.1 Company Overview
15.2.6.2 Product Portfolio
15.2.6.3 Demographic Reach and Achievements
15.2.6.4 Certifications
15.2.7 Close Brothers Group plc
15.2.7.1 Company Overview
15.2.7.2 Product Portfolio
15.2.7.3 Demographic Reach and Achievements
15.2.7.4 Certifications
15.2.8 Tandem Bank Limited
15.2.8.1 Company Overview
15.2.8.2 Product Portfolio
15.2.8.3 Demographic Reach and Achievements
15.2.8.4 Certifications
15.2.9 Royal Bank of Scotland plc
15.2.9.1 Company Overview
15.2.9.2 Product Portfolio
15.2.9.3 Demographic Reach and Achievements
15.2.9.4 Certifications
15.2.10 Nationwide Building Society
15.2.10.1 Company Overview
15.2.10.2 Product Portfolio
15.2.10.3 Demographic Reach and Achievements
15.2.10.4 Certifications
15.2.11 Others
16 Key Trends and Developments in the Market
List of Key Figures and Tables
1. Europe Car Loan Market: Key Industry Highlights, 2018 and 2032
2. United Kingdom Car Loan Market: Key Industry Highlights, 2018 and 2032
3. United Kingdom Car Loan Historical Market: Breakup by Vehicle Type (USD Billion), 2018-2023
4. United Kingdom Car Loan Market Forecast: Breakup by Vehicle Type (USD Billion), 2024-2032
5. United Kingdom Car Loan Historical Market: Breakup by Ownership (USD Billion), 2018-2023
6. United Kingdom Car Loan Market Forecast: Breakup by Ownership (USD Billion), 2024-2032
7. United Kingdom Car Loan Historical Market: Breakup by Loan Provider (USD Billion), 2018-2023
8. United Kingdom Car Loan Market Forecast: Breakup by Loan Provider (USD Billion), 2024-2032
9. United Kingdom Car Loan Historical Market: Breakup by End User (USD Billion), 2018-2023
10. United Kingdom Car Loan Market Forecast: Breakup by End User (USD Billion), 2024-2032
11. United Kingdom Car Loan Market Structure
Key Questions Answered in the Report
In 2023, the market reached an approximate value of USD 62.48 billion.
The market is estimated to grow at a CAGR of 6.4% between 2024 and 2032.
The market is estimated to witness a healthy growth in the forecast period of 2024-2032 to reach a value of around USD 109.20 billion by 2032.
The market is being driven by soaring vehicle prices, increasing four-wheeler demand, and fair terms and conditions that encourage consumer savings.
The key trends aiding the market expansion include greater preference for used vehicles, availability of multiple car loan financing options, the switch towards the adoption of four-wheelers, and ease of online loan payment.
The major car loan providers include banks, OEM, and NBFCs.
The major end users of car loans include individual and enterprise.
The major players in the market are Barclays PLC, BNP Paribas S.A., Bayerische Motoren Werke AG (ALPHERA Financial Services), Santander UK plc, Lloyds Bank plc, JBR Capital Ltd., Close Brothers Group plc, Tandem Bank Limited, Royal Bank of Scotland plc, and Nationwide Building Society, among others.
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