UK motorists could be slapped with a 10% rise in annual car servicing costs if the UK can’t negotiate a deal with the European Union for Brexit.
A new report, called the Importance of the Aftermarket to the UK Economy 2017, shows that annual car service bills could rise by about £70 per person if the government fails to prevent the implementation of tariffs on imported goods.
The study, commissioned by the Society of Motor Manufacturers and Traders (SMMT), shows that since 80% of car parts sold in the UK aftermarket are imported, with more than three-quarters of them coming from Europe, that would equate to a national increase in costs of £2.14 billion.
The main trigger for such a rise would be a 2.5-4.5% World Trade Organization (WTO) tariff, which could be enforced if no free trade deal with the EU is made. The added costs passed on to motorists would be made up of £21 in annual servicing bills, as well as a further £49 per car resulting from quotas, subsidies, customs delays and regulatory barriers.
Along with an anticipated rise in inflation of £10, that would send average annual servicing costs up from £707 (2016) to £787 in the UK’s first post-Brexit year.