05 June 2017

The first results of Auto Retail Network’s dealer barometer prove the industry has been rattled by the General Election. We’ll know who we’ve got for the rest of the decade and beyond by the end of this week, but the wait-and-see reaction of the car buying public invites some apolitical speculation as to what’s in store. 

If it’s a Conservative win on Thursday then things are likely to settle down pretty quickly, simply because markets like established norms – they’re happy when they know what they’re getting. We’ve already seen the evidence for this; in last week’s Agenda, we reported that the pound put in a stronger performance after opinion polls favoured a Tory victory.

A Labour win or a hung parliament is far less of a certainty and would engender a very different economic direction. Such a result would likely send an initial pulse through the financial markets, and take some getting used to.

Whatever the result, it’s worth bearing in mind three things: firstly, that it doesn’t take much ruffle the markets, and if a new party takes over, things won’t change immediately. It’ll be a case of keeping your eye on the ball and reacting accordingly, rather than an immediate sledgehammer effect.

The second is that the UK new car market reached its peak in 2016, and while the government will have a huge sway over the economy, the inevitability of a contracting market will continue with or without a dose of politics. 

Finally, by the end of the week, car buyers will have a modicum of certainty about how the next four years will pan out. The past two years have arguably been the most politically tumultuous of this century – and Brexit and haywire international politics will continue to bubble away – but here’s hoping we Brits can have a well-earned rest from elections and referendums for a while. 

If nothing else, there should be fewer reasons for the buying public to hold off on their purchases. 

Jack Carfrae

Acting editor

Auto Retail Agenda

Tags: 2017 General Election