The polls have closed, the vote is in, and with a result of 52%-42%, the United Kingdom has chosen Brexit. And while we won’t enact Article 50 until a new Prime Minister is chosen in October, and we still have two years of negotiations to follow before our actual departure, the question on everyone’s lips is “what now”? Generally this question is met with concerned looks and uncertain shrugs. Unfortunately, there really is no way of predicting with certainty what the outcome will be of this unprecedented result. But here are a few things that experts are predicting for motoring in post-Brexit Britain.
Despite 77% of the motoring industry being pro-remain, most experts have predicted that Brexit is unlikely to have a huge impact on the price of buying cars. The used car market is only likely to be impacted by the drop in the value of the pound, but should ultimately come out of Brexit unscathed.
And new cars? That’s slightly more complicated. As with the used market, the decreasing value of the pound will likely increase the price of buying new. On top of this, new trade tariffs are likely to make importing raw materials more expensive, and this additional manufacturing expense may be passed on to customers.
Car finance may also become more expensive, as banks and finance companies will likely look to increasing interest rates to combat instability in the exchange rate and stock market.
One of the first industries to see a marked hit in the aftermath of Friday’s vote was the Crude Oil Industry. The price of crude oil saw its largest back-to-back drop since February as result of the Brexit win, and while this may seem like a positive, it may cause a longer term increase in the wholesale price, which could then be passed on to drivers. Both the AA and RAC have predicted price increases, with the AA offering it’s ‘worst-case scenario’ of an 18.7p per litre price hike.
Due to the UK being excluded from the Schengen Area, passport control when leaving and entering Europe via the UK has always existed. However, Brexit will likely lead to tighter border control, increasing the time taken at border, and trips duration without a Visa could be restricted.
Brexit could also bring an end to the bulk-booze run to France. Currently, the limit of bringing alcohol and cigarettes into the UK from the EU stand at 800 cigarettes, 110 litres of beer and 90 litres of wine. This compares to 200 cigarettes, 16 litres of beer and 4 litres of wine from non-EU countries.
Finally, Britain’s exit from the EU could cause an increase in roaming charges. These are currently restricted by EU regulations, and are due to be brought down to zero from June 2017. Outside of the EU, British providers will no longer be required to restrict their roaming charges, meaning it may be time to abandon Google Maps abroad in favour of the trusty sat nav.
Insurance and Breakdown
Starting on a positive, breakdown cover is unlikely to change. Both the AA and RAC use local providers in Europe and are likely to continue this after Britain’s official exit. However, the price of breakdown cover may increase in order to combat changes in exchange rates.
Unfortunately, the status-quo is not likely to be maintained when it comes to insurance. Currently, the EU Motor Insurance Directive requires insurers to guarantee drivers are insured throughout Europe. This will no longer apply once the UK leaves the EU, and insurers will most likely introduce premiums for European cover. Also, the requirement for insurers to disregard gender as the result of the controversial 2012 European Court of Justice ruling will no longer apply, which could see the return of higher insurance rates for men than women.
Ultimately, the impact of Brexit is impossible to predict. As the first EU member ever to enact Article 50, there is very little for experts to go off of in terms of long term predictions. However, in the short term, motorists should feel little-to-no impact on their driving as a result of this referendum. So, for once…