3 things that are contributing to falling car sales in the UK

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A row of new cars

The motor industry is one of the backbones of the British economy and it generates £72 billion a year. Car sales were excellent last year, and 2.7 million cars were registered. However, over the last few months, the industry seems to be hitting a period of uncertainty – car sales fell by 12.2% in October alone. Trade body the Society of Motor Manufacturers and Traders (SMMT) have suggested that consumer confidence and falling business is to blame for the big drop in car sales. The last twelve months have been quite testing for the motor industry and there have been quite a few changes. These things may be contributing to the decreasing car sales across the UK. Are you wondering what they are? Well, look no further as we’ve put together a list of the changes happening in the motor industry and what impact they could have on the future of the industry.

1. The lack of security surrounding Brexit negotiations

This is an ongoing story since the UK voted to leave the European Union (EU) last year. Since then article 50 has been triggered and there’s now a time limit on the government to negotiate a deal with the EU. In order for our industry to thrive there needs to be a secure tariff-free deal and a good working relationship with our biggest market. Additionally, there should be open borders, so products, parts, and investment can flow with ease. Car sales are currently worth 12% of the UK’s goods exports which makes our industry one of the biggest exporters. There’s still no clear trade deal between the UK and EU and if one isn’t secured there could be a 10% levy added to car prices.

2. The petrol and diesel vehicle ban

Earlier this year the government revealed plans to ban the sale of petrol and diesel vehicles by 2040. The decision was made after the consideration of the impact that poor quality air is on people’s health. However, this announcement was met with some confusion as it wasn’t explained very well. It could be making people hesitate before purchasing a petrol or diesel vehicle. Having said all of this the demand for hybrid and electric cars is an ever-growing business and sales were up by 37% last month.

3. The new driving test changes

This one is fairly self-explanatory. From 4th December 2017 the practical driving test in the UK is having four major changes. It’s going to be more challenging for consumers to pass their test and the changes are being made to modernise the test. Drivers will have to use technology while driving by following directions from a sat nav. One in five tests will not have to do this. These changes could deter new consumers from purchasing a vehicle if they don’t pass their test in the new format.

These are three of the biggest changes happening in the motor industry. They could potentially affect the long-term success of the motor industry.

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