Despite hopes that over one million new vehicles will be registered to fleets and lease companies next year, fleet managers - especially those in small and medium-sized businesses - looking to secure finance for their new vehicles will face a tough battle.

While the latest figures revealing the amount lent for new vehicle acquisitions are encouraging, the difficulties getting credit will continue to hit smaller fleets, as Iain Carmichael, head of Audi Fleet Sales confirmed. “We see real risk in the SME sector as these businesses face most issues around cash in 2010.”

The latest figures available show that lending to businesses for new vehicle acquisitions rose by 7% in October 2009.

The longer term stats are also encouraging, with the three months to October 2009 showing the decline in lending may have bottomed – it was down just 1% over the quarter.

However, the 12-month figures show a 20% decline in lending to businesses for new vehicles.

The problem is likely to be exacerbated as more companies look to replace vehicles this year, after putting off purchases in 2009.

“It will be challenging for motor finance providers to meet any increase in demand from businesses in 2010 as the economy recovers,” warned Paul Harrison, head of motor finance at the FLA.

“The capacity of the market has been reduced by consolidation – with a number of high-profile mergers – and some funders leaving the market altogether.”

Harrison also points out that with fewer brokers in the market (although they are offering higher standards) fleet operators are faced with fewer finance options than before the downturn.

The BVRLA is hopeful that its members will catch more of the small fleet business.

“The SME market has traditionally lagged behind other business sectors in its use of vehicle leasing, but we think this could change in 2010.

"Some of our leasing broker members have reported record levels of SME business in recent months,” said John Lewis BVRLA chief executive.

“As some small and medium businesses struggle to access enough affordable finance from their existing lenders they may well turn to leasing.

"Companies without a strong credit history may have to pay a few extra rental payments in advance, but the overall cost of financing their vehicles will be competitive.”