The largest price reductions were in the lower and upper medium sectors where price falls averaged 8.8% and 6.1% respectively. Prices also tumbled by an average 6.1% in the executive sector. Meanwhile, the gap between UK new car prices and rival continental European countries has narrowed by 50% in five months, it was claimed this week. Latest atest figures from the Credit Suisse First Boston New Car Price Index show that average pre-tax car prices in the UK are 21% higher than the European average compared to 42% higher in August 2000.
The Society of Motor Manufacturers and Traders' chief executive Christopher Macgowan says varying taxation systems across Europe is the primary cause of new car price differences - pre-tax prices are traditionally cheaper in Denmark than anywhere else because of car taxes running at almost 200% - and argues that the key to harmonising prices is fiscal changes.