Car loan amounts rise despite GFC in 2009
Thursday February 11, 2010
Despite all the talk of the Global Financial Crisis and the financial pressures placed on budgets and businesses, it seems Australians still want bigger and better cars when it comes to business. Reports of the rise in business car loan figures for 2009 have shown that the average business car loan increased by $1,462 from $43,471 in 2008, to an average of $44,933 in 2009.
This in turn led to the average amount for a car loan application rising to $46,111 in the final quarter of 2009.
However this trend of bigger car loan amounts was not reflected in the personal car loan category where figures from vedaauto.com show personal new car loan dropped 10.6 per cent from November to December 2009, and 14.7 per cent year-on-year.
The reasoning and suspected increase in the number of business car loans is thought to be the federal government's business tax break for small business that applied to new vehicles purchased between 13 December 2008 and 31 December 2009.
Small businesses buying new vehicles were able to claim a bonus tax deduction of up to 50 percent on the cost of buying the new cars, which was up from the 30 percent previously announced as part of the Rudd Government's stimulus package. The tax break was expected to stimulate the new vehicle market and support jobs in the industry while also providing significant savings on the cost of a new vehicle.
It has obviously worked based on the previously stated figures, but the demand for business cars and the subsequent car loans is expected to decline just as swiftly now that the tax break has finished.
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