The Department of International Trade has recently announced a post-Brexit tariff change for new cars built in the EU if the UK is to leave without a deal. Estimates of these costs range from £1500 to £4000+ meaning the cost of your new car could be significantly increased, whether you are purchasing, leasing, or dealing with any new car.
Why will this impact me?
If a deal cannot be agreed prior to the end of the Brexit transition period, a tariff of 10% will be incurred on all cars imported into the country. These changes will have an impact from the 31st December, where any additional costs incurred from manufacturing and importing cars will result in a potential risk of price to those looking for a new car. Many manufacturers have already verified the impact of this tariff, with Mercedes, Peugeot and Vauxhall all confirming the prices of their models will rise in the event of a no-deal.
How much more could I pay?
As nearly 70% of cars registered in the UK are indeed imported from the EU, these cars will all be subject to the new tariff. If a manufacturer chose to pass on the full 10% import tariff, that would translate to a 6.3% increase on the price of a car. The slight difference is down to import tariff levies at the time of import, rather than sale. Taken from Which?.co.uk, the below table shows the 6.3% increase, and how this will affect prices.
Given the upward cost of cars in the last four years, some industry experts warn an average increase could be closer to £1800, with premium makes and models knocking the scale further out of favour.
What can I do?
Car buyers should complete their purchases soon to avoid the risk of price rises from a no-deal Brexit outcome.
Harry Rose, Editor of Which? Magazine spoke to Express.co.uk and said, “with a no-deal Brexit looming and the threat of price hikes of between £1,500 and the best part of £4,000, we’ve found car buyers could be in for a nasty shock after December 31st.”
If the UK is to leave without a deal, some form of a price increase will be inevitable, you can however, avoid this increase by getting yourself into a car now. Here at V4B we have many cars in stock and ready to go, meaning you will be driving your brand-new car far before the increases take effect!
Take a look at some of our hottest deals here, and avoid any extra charges following a no-deal!
If you are not ready to get yourself into a new car and won’t be until 2021. Know that V4B are dedicated to finding you the best deal, and will continue to do so if and when the tariff increase takes effect.