Fleet News

ACFO fears chaos over price structures

COMPANY car tax could be based on 'suggested retail prices' and not 'recommended retail prices' following the Competition Commission-inspired shake-up of the UK motor industry, it was claimed this week. And there are also fears that a 'two-tier' pricing structure could be introduced which would effectively see separate pricing for retail and fleet customers.

Therefore, manufacturers may tell dealers that cars can be sold 'from' a certain price. But simultaneously they will publish a 'suggested retail price' which will become the price for benefit-in-kind tax purposes. Association of Car Fleet Operators chairman Tony Leigh said: 'This has happened with book pricing and it could happen with cars. Company car drivers will be interested in a car's carbon dioxide emission figures rather than the list price.'

However, Christopher Macgowan, chief executive of the Society of Motor Manufacturers and Traders, believes such a move would be unacceptable to Trade and Industry Secretary Stephen Byers, who has price transparency at the top of his agenda. In publishing the Competition Commission report in the supply of cars in the UK, Byers said he had 'not ruled out a ban on recommended retail prices' should his seven-point action plan to 'bring more competition to the supply of new cars and so help reduce prices' fail to find acceptance.

'I don't think a two-tier pricing structure would be a radical enough step for the Secretary of State,' said Macgowan. 'It would be unacceptable because dealers must be allowed to buy cars on the same terms as fleets and pass those terms on to private customers.'

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