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My new lease quote is more than my last car cost, why?

20th April 2018 | Mike Lamb

This is something we are being asked about on increasingly regular occasions, as with many things unfortunately inflation etc. also impacts the cost of leasing vehicles and can make it seem more expensive. However, unlike with other industries the automotive industry can be effected by many other external influences, below we will explain why costs are increasing.

According to research which has been released this week, the average cost of leasing a new car in the UK has increased by 9% in the last 12 months alone. In February 2017, the average cost of a lease car was £232 per month this has now increased to £253 per month as of February 2018. The unfortunate reality is that many cars leased in the UK are either manufactured in mainland Europe or the head offices of the companies are based there, with the GBP rate still weak in comparison to historical levels (it currently sits 14% down against the Euro when compared to pre-Brexit levels), we are getting less for our money when it comes to cars.

Historically the UK has received preferential pricing for new vehicles due to the buoyancy of the automotive market here and we have received abundances of unsold, excess stock from the continent to sell at discounted rates. In recent years the European market  has began to catch us up and is now almost as buoyant as the UK and so our advantageous position of discount seems to be coming to an end. Manufacturer price increases seem to be happening on an increasing basis with many cars having their prices increased anywhere between £500 and £1,500 each time there is a price change; this is a direct response from the manufacturers as they see their own supply chain costs increase at a steady rate.

In addition to the current market turning against our favour, there is also set to be fluctuations in the cost of leasing diesel vehicles following the recent emissions scandals. Prices will most likely be negatively impacted owing to the expected residual value of the vehicle at the end of the contract.

With the face of the UK's economic climate changing and constantly evolving, only time will tell if we will see the trend get bucked or whether prices will continue to climb. One thing is for sure though, no matter what happens we will always endeavour to find you the cheapest deal we can.

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