The UK public has long since cast their votes on whether or not to leave the European Union, with full details of the landmark decision available in this BBC News Article.
But how has the Thursday June 23rd vote affected the motoring industry though? Join us as we find out together with used vans specialist Van Monster which has investigated the aftermath of the Brexit on the sector:
How motorists generally feel about Brexit
An analysis of motorists’ feelings regarding Brexit is perhaps pertinent prior to our analysis of the markets and businesses making up the UK’s motoring industry.
So AA Populus carried out a poll through which they found that more than eight out of ten drivers had concerns about the impact of Brexit on the motoring industry across the country. Nearly 20,000 motorists took part in the survey, which was conducted only three weeks after the referendum was held, bringing to light that respondents were worried about matters such as…
- Fuel prices rising (63 per cent concerned).
- Insurance being more expensive (57 per cent concerned).
- Poorer exchange rates for the Euro(56 per cent concerned).
- Medical care when travelling in the EU being set at a higher price (55 per cent concerned).
Interestingly enough, 39 percent of respondents indicated to be worried that Brexit could increase delays at border crossings and within a matter of mere weeks after the survey was carried out, drivers found themselves having to queue for up to 14 hours at the Port of Dover due to extra French security checks.
Looking into the AA Populus study, AA President Edmund King OBE acknowledged: “The AA did not take a stance on Brexit as we felt it was up to our members to make up their own minds.
However, this AA Populus poll of 20,000 drivers so soon after the referendum shows that many drivers are concerned about the potential for higher costs or more hassle travelling in Europe. Last weekend, thousands of drivers experienced horrific delays at Dover mainly due to lack of staff at French border and passport control.”
Mr King was keen to add though: “We trust that our Brexit negotiators will be working hard to ensure that UK drivers can still enjoy safe and relatively hassle-free driving across Europe in the future.”
A boost for the used vehicles market
Motorists across the UK should probably not be concerned about the used vehicle market however, if the predictions of industry experts are anything to go by.
The Telegraph reported that vehicle manufacturers, who are known to be operating on tight margins, are considering moving the sales of new cars away from the UK so that they may get better returns abroad. However, as pointed out by Chris Bosworth, the Strategy Director at Close Brothers Motor Finance, the industry data depicts an increase in motorists looking for finance deals on used cars, which means it’s not all doom on gloom.
Mr Bosworth reflected: “This is a similar trend to the one in the immediate aftermath of the financial crash, where the used car market was boosted at the expense of the new car market.
“People have been buying new cars in the UK because manufacturers are subsidising deals so heavily that you’re getting ‘£99 down’ and 0pc finance offers. The weak pound could mean they won’t be able to afford that anymore.”
The uncertainty around vehicle production across the UK
Moving on from the dealerships and focussing more on the factories making the vehicles, what does the future look like for them, post Brexit?
To kick things off with some of the good news, according to the Society of Motor Manufacturers and Traders (SMMT), the UK’s car production market has reached 158,641 vehicles in June 2016, making for an increase of more than 10 per cent. What that means is that the first six months of 2016 achieved a 16-year high for the car production rate of the country.
On the flip side however, SMMT’s survey revealed that 57 per cent of members were concerned that Brexit’s impact will be a negative one on their business. Those who were confident of its positive effects only amounted to 8.3 per cent.
The concerns of UK automotive business leaders include the following:
- 68.4 per cent are concerned about tariffs or other barriers being set up between the UK and the EU.
- 66.4 per cent are concerned that they will lose access to EU trade deals.
- 66.1 per cent are concerned about being bound by EU regulations where they will have no say.
- 59.7 per cent are concerned about the uncertainty that is hanging over EU workers currently based in the UK.
Mike Hawes, the Chief Executive of the SMMT, commented: “The latest increase in production output is the result of investment decisions made over a number of years, well before the referendum was even a prospect.
“These decisions were based on many factors but, primarily, on tariff-free access to the single market, economic stability and record levels of productivity from a highly skilled workforce.To ensure the sector’s continued growth, and with it the thousands of jobs it supports, these must be priorities in future negotiations.”