FINANCE NEWS Car finance over long term is proving to be less popular

by John Bowman john@blackballmedia.co.uk

Nearly a third of British motorists – 32 per cent – say they’re far less likely to replace their existing car by committing to a long-term (three-year) lease than they were 12 months ago, an independent new study has revealed.

Lease provider Sogo’s research conducted among 2,006 adults in January 2023 also indicated that only 14 per cent of drivers would be much more likely to commit to a longterm financial lease to fund their next vehicle than 12 months ago.

Some 37 per cent of motorists said they believed short-term leases were more beneficial because of the financial flexibility offered. However, 16 per cent believed they wouldn’t benefit from a short-term lease on a new vehicle.

The company said it believes that short-term leasing will be essential to the mass adoption of electric vehicles before 2030. Electric car sales are predicted to continue to grow as the government’s 2030 ban on the sale of new petrol and diesel cars approaches.

Commenting on the research findings, Karl Howkins, pictured, managing director of Sogo, said: ‘As the economy faces significant challenges, flexible leasing allows shortterm demand to be met without the problems of a long-term commitment in an uncertain market.

‘Monthly leasing frees capital from the balance sheet that can be deployed elsewhere in the company to fund growth.

‘While many managers may not yet be able to transition out of traditional lease models immediately, it’s useful to start thinking about the mix across fleets.

‘Analysis of recent car trends indicates that not everybody needs their car as much as they used to, especially with more people working remotely or from home. Considering a short-term flexible lease offers a great alternative to longer leases.’

WATCHDOG

Thousands of misleading ads blocked by FCA

THE Financial Conduct Authority got firms to amend or remove 8,582 promotions last year – 14 times more than in 2021, a new report shows.

The FCA also published more than 1,800 alerts to help prevent consumers from losing their money to scams.

Social media remains a major focus for the regulator’s work in combating misleading promotions. The financial watchdog said it had worked closely with several big tech firms to change their advertising policies to only allow financial promotions approved by FCA-authorised firms, but it said more needed to be done by tech companies to protect consumers.

So-called ‘fin-fluencers’ have also been a growing concern for the regulator.

Unauthorised individuals shouldn’t advise people on the merits of certain investments, it said, as this would likely be subject to its regulations and could lead to action being taken against them.

The FCA said that it had already acted against several social media influencers over the past year.