Following the exit of the United Kingdom from the European Union, there would potentially be an increase in the price of its cars in Britain, warned Porsche.
A clause that where in a buyer agrees to a potential tariff is being asked by the German car maker Porsche to be signed by users which it calls to be a “precautionary” measure.
The concerns about whether there would also be price rise for some of the other brands of cars of Porsche’s owner Volkswagen including Audi, Lamborghini, Skoda, Bugatti, Seat, and Ducati were left unanswered by the company.
The price of an entry level Porsche 911 would be increased from £93,110 to £102,421 if there is a 10 per cent surcharge imposed.
“As one potential outcome of the Brexit negotiations, there is a possibility that a duty of up to 10% may be applied to cars imported into the UK by us after March 29. In light of this, we have chosen to inform customers whose cars are likely to arrive after Brexit occurs to warn them that they may be affected by this tariff – allowing them to be fully informed at the point of sale and, if they wish, to adjust their order accordingly. “This is a precautionary step in the interests of allowing our customers to plan ahead,” said the Stuttgart-based Porsche in an emailed statement to the BBC which was later picked up by other media.
For example, the company was quoted in Bloomberg as saying that there was need for a “comprehensive clarity” on the future of the relations between the UK and “the EU very quickly”.
Porsche said that the possible rise in prices would not affect those who had placed deposits with the company on or before 17 January. The company imports all of the cars as it has no manufacturing unit in the UK.
The warning by Porsche was bad for the industry because it would result in a tendency among consumers to delay purchasing decisions till such time that they had clearer picture of things after Brexit, said Rebecca Chaplin, editor of Car Dealer magazine, which first reported Porsche’s move.
”Car dealers and manufacturers need to be able to communicate the prices of cars clearly to customers – it’s a fundamental of this business and the government isn’t helping them,” she said.
“Import tariffs alone could push up the list price of cars imported to the UK from the continent by an average of £1,500 if brands and their retail networks were unable to absorb these additional costs,” AA president Edmund King said.
Concerns over possible new tariffs have been expressed by executives at a number of carmakers and they fear that new tariffs would disrupt production and exports after the setting in of Brexit.
A no-deal Brexit would be “catastrophic”, Ford warned last week. .
“We are keeping a very close eye on developments and reviewing the entire spectrum of possible effects. We are noting with regret that there is currently a stand-still regarding the decision on the negotiated deal. For us, this means a further period of insecurity and planning uncertainty. We continue to prepare for all eventualities. Irrespective of this, the United Kingdom will remain an important market for the Volkswagen Group, the second largest in Europe,” said a spokesman for Volkswagen on Sunday.
(Adapted from BBC.com)