How will Brexit effect the cost of driving for UK motorists?

On Thursday 23rd June, 2016, approximately 52% of UK voters (amounting to more than 30 million people) made the decision to leave the European Union. How long it will take before this actually comes to pass is anybody’s guess, but already there have been some major consequences for the UK economy. So what is Brexit likely to mean for motorists?

Cost of vehicles
During the campaign leading up to the referendum, many experts claimed that if Britain were to leave the EU, new car prices would not rise and the used car market as a whole would remain predominantly unaffected. However, it has also been argued that, as nobody really knows what to expect, this being a wholly unique chapter in world history, we should at least be prepared for a period of instability in terms of the cost of new and used cars.

Cost of fuel
The cost of petrol and diesel in the UK is expected to fluctuate, due to changes in the costs of importing fuel. The extent to which fuels costs will rise, however, are as yet unknown, although the RAC have estimated that it could be as much as 5%. It is hoped that any rise in prices will only remain in place in the short term, with markets expected to stabilise reasonably swiftly.

Cost of driving in Europe
Aside from drivers needing to have their passports stamped at border crossings, as well as undergoing any additional immigration controls that will make the whole process take longer, the AA has warned that fuel costs abroad may rise, possibly by as much as 18.7p per litre. This will happen, they say, when a decrease in the value of the pound rebounds on oil prices. if you are considering a trip into Europe, there’s a lot more to come to terms with than which side of the road you should be driving on.

Cost of insurance
According to the AA, there are unlikely to be any immediate changes, while others argue that the costs of the changes in administration necessary to create new UK-specific standards in insurance will see a rise in premiums. Others still argue that insurance premiums might actually drop. Prior to Brexit, all UK insurance policies had to meet various EU criteria, which was often hard for smaller insurers to manage. Once the UK is free from the EU, however, the whole UK insurance industry could become much more competitive, ultimately driving prices down. Read more about how clever use of words are saving people on car insurance quotes

Cost of breakdown cover
As most breakdown service providers generally use local contractors, costs for breakdown cover and roadside assistance are unlikely to change across the UK. However, there may very well be a rise in prices once you are travelling in Europe. Check with your own insurer to be sure.

It is important to remember, however, that nobody really knows for sure what is going to happen, and many of the people speculating are doing so from one political perspective or another. It is also important to remember that it will take a full two years for Britain to extricate itself from the EU from the moment Article 50 is signed, which now seems unlikely to happen till October 2016. So whatever happens, it will take time.

So, whatever you do, don’t panic.

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