Brexit-fuelled economic uncertainty set to boost corporate car rental

January 23, 2017

Despite positive comments from two of the UK’s major automotive associations, there is a growing sentiment of caution among businesses post-Brexit that is set to boost demand for medium-term fleet rental in 2017.  

Meridian vehicle solutions managing director Phil Jerome highlights that more flexible arrangements are being seen as increasingly attractive under the clouds of a possible economic downturn.  

However, this contrasts with overtures from the Society of Manufacturers and Traders (SMMT) and the Freight Transport Association (FTA), which both praised Prime Minister Theresa May for stressing the importance of ‘tariff-free and frictionless trade’ with the European single market once the UK leaves it.  

Jerome said: ‘The effects of Brexit are so difficult to forecast that the majority of businesses are adopting a wait-and-see approach to this year, something that is likely to affect all kinds of areas from capital investment to recruitment.  

He added: What medium-term rental offers against this backdrop is a flexible solution for companies that don’t want to enter into longer-term arrangements. If you are recruiting someone and need a car for their probation period, for example, or if you are employing someone on a fixed-term contract, then it is a very viable product.  

Especially [since] in most cases, the monthly cost of medium term rental of between one and six months is only marginally higher than a traditional three year/60,000 mile contract.’  

In other news, a change to the UK's MOT (annual roadworthiness test) system is being proposed, with new cars only needing their first MOT after four years from 2018, compared to three currently, bringing the UK in line with the European norm.  

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