Car manufacturers in the UK are urging customers to contact them if they’re struggling to keep up car payments, amid job losses caused by the effects of the Coronavirus (COVID-19) pandemic.
Following the UK Chancellor of the Exchequer’s announcement that there will be a three-month payment holiday for mortgages, some car manufacturers are considering this form of financial relief for customers.
>> Read more: Car payment holidays – who’s offering what in full
Who’s going to offer payment holidays?
It’s early days, but car companies are certainly investigating.
Ford, the maker of the bestselling car in the UK, the Fiesta, told Parkers that its plans ‘include extended payment arrangements, payment holidays for all markets, cancellation of late fees and charges, and flexibility on payment methods.’
A spokesperson for Hyundai UK said relief, ‘may include a payment holiday, but each customer’s individual circumstances will be considered at all times.’
Kia‘s official line reads: ‘Kia Finance, as a responsible lender, has in place a number of measures to assist customers in the repayment of their finance agreements should they experience financial difficulty. This may include a payment holiday.’
A source at Honda said that the Japanese car manufacturer, that currently builds the Civic hatchback at its assembly plant in Swindon, would consider a car payment holiday if the virus progresses.
Other manufacturers, such as Toyota, haven’t gone quite as far yet. A spokesperson for Toyota said: ‘There’s nothing to report beyond the usual process. Anyone in difficulty should contact the company as soon as possible to discuss options.’
While MG‘s official statement merely reads as: ‘We’re not a lender’.
What the Financial Conduct Authority says
All lenders during this challenging time are required under Financial Conduct Authority (FCA) rules to work with their customers to arrive at an arrangement that is in the interests of fair and appropriate customer outcomes.
An FCA spokesperson said: ‘We’re not commenting on specific industries at the moment. However, we are in regular contact with firms to assess their current position, and expect firms to be taking reasonable steps to ensure they are prepared to meet the challenges coronavirus could pose to customers.
We expect firms to provide strong support and service to customers during this period.’
What this means for you
This is a step in the right direction for the thousands and thousands of people who are in Personal Contract Purchase or Hire Purchase agreements on a car via a car manufacturer. This could mean a break in monthly payments for thousands of people in need.
The blanket advice, as at any time with these types of agreement, is to contact the provider of the finance if you are struggling to pay. If you’re in a leasing deal, it works slightly differently. Should you find yourself struggling to keep up payments on the lease, we recommend contacting your leasing company as soon as possible.
However, there is a word of warning with this. While car manufacturers look keen to help out customers with officially-licensed products, individual dealers are made up of individual and independent businesses who are free to offer financial products from other organisations. And manufacturers, generally, have no direct influence over these.
Further reading
>> Coronavirus (COVID-19) advice for drivers
>> Government launches plan to make smart motorways safer
>> Vauxhall adds 0% APR to new Corsa
Nothing to report beyond the usual process, I.e anyone in difficulty should contact the company as soon as possible to discuss options.
