Despite the recent legislation passed by Parliament, there remains a strong chance that the UK could leave the EU on a no-deal basis on October 31st. It’s thought that this would decimate certain industries in the UK, with the automotive trade one of the most likely to experience widespread disruption and job losses.
The concept of Brexit is also having a significant impact on the UK’s army of new car buyers, with almost half of this demographic choosing to delay their next purchase for a period of up to two years or more.
This is obviously a result of the uncertainty created by Brexit, but are customers right to delay buying their new car? Here’s why this may represent a false economy.
The State of the Automotive Industry in Numbers
There’s no doubt that Brexit uncertainty has taken a heavy toll on the automotive sector in the UK, as well as the customers who are planning to buy a new car in the near-term.
Even institutional investors are running for the hills, with the level of capital pumped into the UK marketplace having collapsed by a staggering 70% during the last three years.
In total, just £90 million was invested into this space during the first half of 2019, compared with the annualized average of £2.7 billion that was committed over the course of the previous seven years.
This decision has arguably been justified by the declining level of productivity within UK manufacturers, as output fell by a fifth in the first six months of this year.
Why Now May be the Best Time to Buy a New Car
Of course, the first half of 2019 included temporary shutdowns across a number of manufacturers, but what’s telling about these numbers is that both customers and investors are turning away from the automotive sectors in their droves.
Now, whilst it may be easy to understand the caution of customers in such a volatile marketplace, the fact remains that buying a car before the UK embarks on a no-deal Brexit may represent the best course of action.
After all, the introduction of WTO tariffs in the event of a clean break from the EU will send import and purchase prices soaring, whilst you may also have a smaller range of models to choose from once Halloween has come and gone.
There’s ample evidence of these assertions too, with the value of the pound set to plunge in the event of a no-deal. This will create a less attractive and profitable market for manufacturers, causing them to potentially relocate or reduce their range and output at the very least.
Even if you’re concerned about buying a car prior to Brexit, you can minimise your costs by partnering with a premium second-hand dealership such as Peter Vardy.
This helps you to source high-quality, used vehicles at competitive prices, without having to compromise on performance or the type of car that you want to buy!
