Wins and losses if the Summer 2015 Budget for the dealers!

[Philip Nothard 26]

Lost in yesterdays budget announcements, is the changes in the car industry.

 

22. Road tax will be reformed and the money raised spent on the road network

The road tax system will be revised to make it fairer and sustainable. From 2017, there will be a flat rate of £140 for most cars, except in the first year when tax will remain linked to the CO2 emissions that cars produce. Electric cars won’t pay any road tax at all and the most expensive cars will pay more.

Existing cars won’t be affected – no one will pay more for a car that they already own. The money brought in from road tax in England will be spent on England’s roads from 2020.

The government will extend the deadline for the first MOT of new cars and motorcycles from 3 years to 4 years.

 

• Interestingly, what could this cost the industry?

• Will it extend the renewal cycle for those consumers who change just before the MOT?

• Will Lease/CH companies look to increase their average contract period to 4-years?

• How much will it cost those who rely on MOT work for income?

• Does it actually cause a change to the price you would pay for a used car - 3-4 year old, as the existing MOT won't influence it?

• How did you view these changes?

[Gavin@Rousdon 137]

I think the reason for 3 year lease's is due to most new cars having a 3 year warranty on them, unless manufacturers increase the warranty length I can still see 3 years staying the norm. The lease companies may still insist on the cars getting an MOT type inspection before handback which happens now (MOT a month before lease end). Also many PCP deals work with the cars going back after 2 or 3 years. I imagine people buying long term will take out normal HP finance.

Not to sure why it's been changed to 4 years as it's hardly something people have been complaining about. I'm sure there are a lot of unroadworthy cars less then 3 years old on the road. Maybe 4 years or 60000 Miles would be a better idea. 

 

Cost to the industry, well number of new car registered in 2017 x £54 (cost of MOT) as a rough guide !! But hopefully workshops will calm the money back as cars may need more spending on them due to things which would have been picked up on a MOT will become bigger job due to uncaring owners not maintaining there cars (example being brake pads turn into brake pads and disc's). Or maybe thats my wishful thinking

Edited July 9, 2015 by Gavin@Rousdon