Motability Operations, the British car leasing company responsible for running the government-backed mobility scheme for disabled drivers, has reported a massive pre-tax loss of £564 million for 2023.
Just a year earlier, the company had posted a £748 million profit.
The figures, reported by Autocar, show just how quickly things can change—even for a company that’s been seen as stable and successful for years.
The Motability scheme, which lets people with disabilities lease a car through government support, has actually grown in the past year. Around 15% more people joined the scheme, but that wasn’t enough to stop the company from slipping into the red.
Costs Are Rising Fast
According to the company, the loss is mostly down to the rising cost of running the scheme. In particular, insurance has become much more expensive—up 46% since 2022.
That means each car now costs around £700 more per year to insure and maintain.
On top of that, the company says it is spending more on new vehicles, especially electric cars, which are more expensive to buy and service. It’s also making less money from selling used cars, which used to be a helpful source of extra income.
Motability is owned by several major banks, including Barclays and HSBC, and doesn’t get money directly from the government, though it runs a government-backed programme.
“We Can’t Shield Customers Forever”
Chief Executive Andrew Miller said that although the company had been able to protect customers from rising prices by using profits saved up after the COVID-19 pandemic, that time has now passed.
“With all the changes in the market—rising inflation, energy costs, and the shift to electric cars—drivers across the UK are paying more. We’re not immune to that,” he said. “We’ve done what we can to shield customers from these costs, but now people will start to see prices go up.”
Even though Motability’s revenue went up, from £48 billion in 2023 to £61.2 billion last year, the rising expenses meant the company still made a loss.
What It Means for Drivers
Right now, people in the Motability scheme can lease a car for £75 per week, a price that covers insurance, servicing, and breakdown cover. But with the company now in the red, there are concerns that weekly prices may soon rise.
Motability says its main goal is still the same—to help people with disabilities have access to safe and reliable transport. But doing that while dealing with higher costs will be a big challenge in the years ahead.
