Higher borrowing costs could place further pressure on automotive retailers and consumers, with National Franchised Dealers Association (NFDA) raising concerns over the impact of the Bank of England’s latest interest rate increase.
The Bank of England has increased the base rate from 3.75% to 4%, marking the first rise in more than three years, as policymakers respond to increasing inflationary pressures.
Sue Robinson, Chief Executive of NFDA, said:
‘The increase in interest rates will be disappointing for automotive retailers and consumers, particularly at a time when household budgets and business costs remain under pressure.
‘Higher borrowing costs could further impact vehicle affordability and consumer confidence. We recognise the need to tackle inflation, but it is important that decisions also consider the impact on consumer spending and business investment. A stable economic environment is essential to supporting growth across the automotive retail sector.’
NFDA will continue to monitor economic developments and their impact on automotive retailers, while supporting consumer confidence and affordability across the sector.