Today, more than 80% of new cars bought privately are acquired via personal contract purchase (PCP), which is, essentially, a form of leasing dressed up as a more flexible alternative to hire purchase. Those affordable monthly payments are perfect for getting bums on seats and also for buyer retention, as it means customers will be back across your threshold by the time their PCP agreement expires. Indeed, this can often happen sooner if customer trends continue as they are. Almost half of all PCPs now end before their full term as customers come back looking for a deal on the latest and most up-to-date models. In a car market that's, at best, challenging, this is good news. But new regulations due to be introduced by the Financial Conduct Authority (FCA) following a review in October 2019 look set to ban dealerships from receiving external commission on certain types of finance to prevent them acting "against customers' interest".
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