Budget 2013: The reaction

Time 3:15 pm, March 20, 2013

big benGEORGE OSBORNE has finished revealing just how the country’s money will be spent in 2013 – from income tax to grants for vehicles that emit low levels of carbon dioxide.

Now the Budget is delivered, we’re hearing from the motor trade’s most influential people on just what the announcements will mean for the industry – with seven exclusive points of view.

Stuart Kerr, CEO of Ford Retail

The news that the fuel duty rise has been cancelled will be welcomed by families and commercial drivers alike but prices remain high, and we expect fuel efficiency to remain at the top of motorists’ shopping lists. New technologies such as our EcoBoost engine can help keep families on the road.

Ken Trinder, director of Job-Co-Op

Despite economic conditions that are probably the toughest in living memory, dealers have proven themselves capable of maintaining profitability with levels of new and used car sales that, given the general lack of confidence among both private and fleet customers, are little short of astonishing.

Over the following months and years, it is a case of continuing to follow the policies that have enabled them to achieve this while working hard to generate new opportunities and exploit them where possible.

David Brennan, managing director of LeasePlan UK

Cancelling September’s planned fuel duty hike is welcome news for drivers alongside the continuing commitment to scrap the fuel duty escalator. This decision will help ease the burden for UK motorists, delivering an average annual saving of around £65 per vehicle from September. For companies running sizeable fleets, that adds up to a meaningful saving.

The Chancellor’s decision to apply tax incentives for manufacturing ultra low emitting vehicles will deliver greater choice for business drivers. This decision signifies a return to the sensible policy of incentivising environmentally-friendly vehicles. Zero-carbon vehicles should still be the industry’s aim, but this will require a long-term commitment in changing infrastructure.

James Tew, director of iVendi

There is little in the Budget to cheer dealers but, with the lack of wriggle room available to the Chancellor, this is only to be expected. As George Osborne went to some lengths to underline, the economic picture for the immediate future remains, at best, flat.

As a result, we believe that the dealers who continue to prosper in the next year will be those who follow the same strategy that has enabled the best to maintain profitability throughout the post-credit crunch period – working to increase the number of opportunities available to them and ensuring those opportunities are maximised.

Andy Cullwick, head of marketing at Manheim

The Manheim Dealer Confidence Barometer showed that dealers had a mixed year in 2012, but were generally more confident about their prospects in 2013. There has been little in the Budget to impact upon that sentiment.

We welcome the Chancellor’s cancellation of the planned fuel duty rise in September. However, we are in a time of record highs which are ultimately taxing many people off the roads. As far as the motor trade is concerned, if people can’t afford to drive then there will be no need to sell them vehicles. And, as people reduce the miles they drive each year, the servicing and aftersales industry will also begin to feel the pinch.

In terms of company cars and vans, the benefits for ultra-low emission vehicles are changing with new tax bands being introduced. We welcome the emphasis on greener travel and the commitment going forward to make announcements up to three years in advance so that businesses may better plan for the most effective fleet mix.

Gemma Stanbury, car insurance expert at

The government’s scrapping this Autumn’s fuel hike is a welcome victory for drivers. Fuel has already shot up in price this year which has been a blow to families trying to make ends meet and to young drivers who are being priced off the roads due to high car insurance premiums.

The chancellor’s announcement today to scrap the rise in fuel duty will be met with relief by all motorists, particularly those who rely on the roads to keep their businesses up and running.

Ian Simpson, sales and marketing director at The Warranty Group

The generally strong performance of the motor industry over the last year has been one of the brighter spots in an otherwise grim economic picture, so dealers could expect little or no specific help from the Budget and have not been disappointed.

To continue to drive forward dealer profitability, we believe that the best franchise and independent dealers will continue to concentrate on the basics – creating strong new and used car propositions and capturing increasing levels of aftersales work.

John Leech, UK head of automotive at KPMG

By reducing corporation tax to 20% from 2015 the UK will have the most competitive tax regime amongst the automotive producing nations in Western Europe.  New tax incentives for manufacturers of ultra-low carbon vehicles will hopefully help to cement this area of strength within the UK’s automotive industry.

Underlining his commitment to manufacturing as a key driver of growth, the Chancellor is injecting £500 million into key sectors such as automotive as part of the Government’s Industrial Strategy. It is this more collaborative, hands-on style of Government which has informed today’s policy announcements and is especially valued by the industry.

David Wallace, sales and business development director at Epyx

Last year’s Budget contained a couple of surprises for fleets, especially the 130g/km Capital Allowances change, but there was nothing quite as significant to report this time around with the minor exception of the fuel duty freeze and the new 50g/km and 51-75g/km CO2 benefit in kind tax bands, which will only be relevant if more cars become available that can meet these targets.

Mark Robinson, managing director of Meridian Motor Group

The cut of up to £2,000 in the National Insurance paid by businesses will especially help SMEs like us who want to grow the business and take on new staff.

The decision to scrap the planned rise in fuel duty scheduled for September and raising the income tax threshold to £10,000 is also welcome, as anything that puts more money into people’s pockets will help drive customer spending. In an ideal world the Chancellor could have gone further and actually cut the current rate of fuel duty or proposed specific help for the motor industry. As it is the budget is welcome if a bit unspectacular.

Jon Reay's avatar

Staff Writer Jon is one of the Car Dealer team's newest members. You can also find him contributing to AOL Cars.

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