Demand for new car finance grew in October but 2010 could spell difficult times for the motor industry, according to the Retail Motor Industry Federation (RMI).

Figures released from the Finance and Leasing Association (FLA) revealed that October saw a strong demand from consumers for new car finance.

The findings showed that the number of new cars using forecourt finance was up 18 per cent in October. The RMI has suggested that this growth will continue up until the end of 2009 before a number of changes hit the industry.

Commenting on the new figures Sue Robinson, RMI director, said: "2010 could see a tougher market place for vehicle sales as consumers are hit with increased VAT, the removal of scrappage incentives and constricted disposable income."

She added that point of sale finance has been important in helping consumers return to the market in the wake of the reduction of other forms of finance such as personal loans.

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