Servicing your car could cost more post-Brexit, motor industry warns
The average cost of your annual service could increase by as much as £70 if no trade deal is reached between the UK and the EU, the Society for Motor Manufacturers and Traders (SMMT) has warned.
A report suggests that if the UK resorts to World Trade Association (WTO) trading rules post-Brexit, imported car parts will be subject to a tariff of between 2.5% and 4.5%, adding at least £21 per year onto the cost of service components.
The average cost of car maintenance currently stands at around £706.71 per car but, with WTO tariffs in place, this would increase to £787.
With more than 80% of replacement car parts imported (three quarters of which come from the EU), it would equate to a collective rise of £2.14 billion in servicing costs.
The SMMT report also highlights the risk to UK suppliers which accounted for a turnover of £21.6 billion in 2016, contributing £12.5bn to the UK economy and accounting for some 347,000 jobs.
Last year, UK motorists increased their spending on car maintenance by 1.7% to an average of £707. This was due, in part, to the replacement of more high tech components, which require new skills and equipment to fit.
While tyres, lubricants and filters are still the most commonly replaced items, Frost & Sullivan research shows that demand is rising fastest for telematics devices and tyre pressure monitoring sensors.
Mike Hawes, SMMT chief executive, said: “This report shows just how vital the UK automotive aftermarket is to our economy and society, supporting hundreds of thousands of jobs and keeping vehicles safe – and the country moving.”
The news comes just days after the SMMT called on the government to clarify its position on Brexit following a 13.7% decline in UK car production.
It is calling for an interim trade deal with the EU to avoid the UK’s automotive sector falling off a “cliff edge”, if no deal has been reached by 2019. The SMMT predicts that a decline of more than 10% is likely if no agreement is reached.
Hawes added: “If we don't secure a new trading relationship with the EU that is free of tariffs and customs checks, British consumers could face significant increases to their annual car repair bill due to new tariffs and other trade barriers.”
Of course, one way to avoid rising servicing costs could be to add maintenance to your monthly car leasing price. If you include the option of maintenance within the contract, this generally covers you for your annual service, plus any wear and tear items which need replacing.