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The Guardian - UK
The Guardian - UK
Business
Jasper Jolly

Will high interest rates burst the new car bubble and will drivers hand back keys?

People viewing cars on the forecourt at a car showroom
People viewing cars on a forecourt. The number of cars bought on finance fell by 10% in May compared with the same month in 2022. Photograph: Jacob King/PA

Britain’s car buyers are a nation of borrowers: more than four in every five new cars bought by individuals in 2022 was paid for with borrowed money.

For more than a decade that borrowing, on attractive terms thanks to ultra-low interest rates, opened up the car market to people without much in the way of savings – allowing the Mondeo Man to upgrade to a Mercedes-Benz C-Class.

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