UK car sales website Motors has reported a rise in car searches from other right-hand drive markets in Europe after the value of the pound weakened against the euro.
Analysts at the website say visits from the Republic of Ireland increased by 151% in October compared to the same period in 2015, while visits from Cyprus rose by 117% and those from Malta increased by 43%.
The value of sterling fell sharply in the wake of the UK’s vote to leave the EU, with exchange rates falling as low as £1.09 against the euro during October. Before the vote, the exchange rate sat around £1-€1.4.
Dermot Kelleher, director of business intelligence at Motors, said: ‘The impact of the falling pound has already been observed in other industries, such as consumer electronics.
‘It stands to reason that the savings on even more expensive goods such as cars could be even greater – encouraging more European consumers to spend in the UK.’
However, the search for an exchange rate bargain may not prove fruitful. Several manufacturers have announced price increases in the UK to stem their exchange rate losses.
General Motors Europe president Karl-Thomas Neumann said in an interview with Automotive News Europe that prices of Vauxhall models will rise by at least 2%, while brands including Ford, Nissan and Peugeot have also taken action.
Ford and General Motors have estimated combined losses of more than €1 billion over the next two years because of currency fluctuations and predicted losses for manufacturers with European headquarters could run into hundreds of millions of euros.
As a result, economists warn that UK inflation could soar from 1% to 4% in the next two years.
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