Fleet News

Makers solely to blame for high cost of new cars in UK, says report

DISCOUNT fleet deals, manufacturer profiteering and European tax regimes are all to blame for the higher new car prices charged in the UK than on the continent. In a scathing report on the motor industry, a Trade and Industry Select Committee has dismissed the usual explanations - a fluctuating exchange rate and the additional cost of making right-hand-drive - for the UK suffering higher prices for new cars than European countries.

Instead, the committee laid the blame for UK motorists paying too much for their new cars firmly at the doors of car makers. Martin O'Neill, chairman of the committee, said: 'The current price differentials between the UK and other EU countries are far beyond those formally regarded by the EC as acceptable.' He added that cut-price fleet deals were driving up the cost of new cars to the private motorist because manufacturers sought to recoup lost profits from less powerful customers, and accused car makers of 'arrogance and a lack of interest in the public'.

'I think the bulk discount is too great for some fleets and the price is paid by the ordinary car buyer,' he said. A fellow member of the committee, Bob Laxton, MP (Labour, Derby North), added: 'I would like to see moves taken to deter fleets from having very large discounts, including naming and shaming.' This position was condemned by the Retail Motor Industry Federation, whose chief executive Christopher McGowan, said: 'This session shows what a lamentable attitude the select committee has.

'The industry, including fleets, has been branded as criminals and the tone of their comments was distasteful. 'There may be some subsidy for fleets and we do not believe they should be able to secure prices lower than dealers, but it is just a factor in the industry, not a major event.'

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