The Bank of England (BoE) has confirmed that interest rates will be cut to 4.5% today, the lowest level since June 2023.
The announcement was welcomed by dealers. Sue Robinson, Chief Executive of the National Franchised Dealers Association (NFDA), representing car and commercial retailers across the UK commented:
“The Bank of England has reduced interest rates further to 4.5%, following cuts in August and November last year. This decision will help to ease some of the pressure on both consumers and dealerships amid ongoing economic uncertainty.”
The cost of motor dealers doing business is set to rise in April as a result of the measures included in the 2024 Budget.
The National Insurance rate that employers pay in contributions will rise from 13.8% to 15% on a worker’s earnings.
This will increase the cost of running a franchised dealership, which is already facing headwinds including high energy costs.
The National Minimum Wage will rise from £11.44 to £12.21 from April 2025. For 18 to 20-year-olds, the minimum wage will rise from £8.60 to £10. Apprentices will see pay jump from £6.40 to £7.55 an hour.
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