The future of Yes Car Credit hangs in the balance as parent company Provident Financial considers its options following the car loans business’s continued losses.

A top-five used car retailer in 2003, Yes Car Credit has incurred a £6.2m pre-tax loss for the first six months to June 30, 2005, compared with a profit of £5.7m for the same period last year. A total of 15,289 vehicles were sold and financed during the first half of the year, 25% less than in the corresponding period in 2004.

“The majority of the group is delivering good results,” says John van Kuffeler, chairman of Provident. “The exception is Yes Car Credit, where a new management team is implementing a comprehensive improvement plan to return the business to profitability during 2006. We are monitoring performance against this plan and will keep the business under strategic review.”

Provident has reiterated that Yes Car Credit is expected to make a full-year loss of between £15m and £20m and has said it will consider all the options, including sale or closure, if the new management and a recovery plan fails to reverse its fortunes.

“The company is conducting a full strategic review over the next six months and will look at all the options. One option could be a slightly different capital structure,” says a spokesman.

Yes Car Credit was formed in 1997 by Len Newby and Joe Prince with backing from venture capitalists Candover and with mezzanine finance from the Royal Bank of Scotland.