BREXIT: HOW ‘LEAVE’ VOTE AF­FECTS YOU

De­mand from in­ter­na­tional buy­ers rises, val­ues to re­main strong and ‘clas­sic friendly’ leg­is­la­tion more eas­ily achieved

Classic Car Weekly (UK) - - Front Page - Sam Skel­ton

Bri­tish clas­sic val­ues are un­likely to be hit by Brexit in short term, but ex­ports are set to in­crease due to early ad­just­ments in the value of ster­ling.

As for the wider clas­sic com­mu­nity, the re­sult has opened new di­vi­sions. FBHVC’s Ge­off Lan­caster says: ‘A re­main vote would have se­cured us a seat at the ta­ble when dis­cussing the clas­sic car move­ment across Europe. Hav­ing left, we can only watch from the side­lines.’

Chair­man of the Par­lia­men­tary Historic Ve­hi­cle Group Sir Greg Knight dis­agrees. He says: ‘Bri­tain is clas­sic-friendly, and I feel this move will al­low us to breathe eas­ier.’

Last week’s EU Ref­er­en­dum looks set to prompt huge changes in the clas­sic car mar­ket. In­dus­try ex­perts be­lieve main­stream Bri­tish clas­sics are un­likely to be hit by the UK’s vote to Brexit, but im­ports at the in­ter­na­tional end of the mar­ket will cer­tainly be af­fected by early ad­just­ments in the value of Ster­ling.

Prices of com­mon im­ports al­ready in the UK are likely to strengthen as a re­sult. With 52% of votes favour­ing an EU exit against 48% vot­ing to re­main, the coun­try has by a whisker set into ac­tion the big­gest Bri­tish po­lit­i­cal up­heaval in a since the end of WWII – and eco­nomic pun­dits pre­dict wide­spread changes ahead.

It is un­likely that the do­mes­tic mar­ket for Bri­tish clas­sics will feel any effect from Brexit, if peo­ple keep on spend­ing. Mal Bishop of Spurr Clas­sic Cars of Sh­effield is un­con­cerned by the re­sult: ‘Our buy­ers tend to be quite pa­tri­otic and want to buy Bri­tish cars, and I can’t see those chang­ing much. The only sce­nario it might affect is the cars we im­port from the US, where a new trade deal might have made these cars cheaper for UK buy­ers.’

How­ever, for those trad­ing across bor­ders the story is very dif­fer­ent. David Golding of Dublin-based Clas­sic & Vin­tage Cars says: ‘The re­sults of leav­ing will be dis­as­trous, par­tic­u­larly if Ster­ling ends up crashing as a re­sult and ends up achiev­ing par­ity with the Euro.

‘I do most of my busi­ness – as much as 60-70% of the cars I deal with – with the UK. In the long term it’ll mean hav­ing to pay tar­iffs and im­port du­ties on cars from there – the sort of thing I cur­rently have to do when I’m sourc­ing cars from Ja­pan.’

The early re­ac­tion from the fi­nan­cial mar­kets was wor­ry­ing, with the pound fall­ing to its low­est level against the dol­lar since 1985 and the FTSE 100 record­ing its big­gest one-day drop in his­tory. The mar­kets did re­cover slightly, but with the Gov­ern­ment in limbo, and the EU call­ing for us to come to the ne­go­ti­at­ing ta­ble, the sit­u­a­tion is still very fluid.

Nick Whale, man­ag­ing di­rec­tor of Sil­ver­stone Auc­tions, is un­sure about the longer term but agrees that there will be tur­moil in the com­ing months. He says: ‘Leav­ing the EU will un­set­tle val­ues. We won’t just be able to pop a car on a trailer and take it to Europe. We don’t know the rates of tax var­i­ous coun­tries will levy on imported cars and that will have an im­pact on the will­ing­ness of peo­ple to bid or buy.’

‘It’s too soon to tell how this will affect the mar­ket,’ re­torts Lon­don dealer Graeme Hunt. ‘We don’t yet know where the pound and Euro will sta­bilise, and we can’t pass judg­ment about their re­la­tion­ship. If the pound con­tin­ues to be low against the dol­lar we can ex­pect to see Amer­i­can buy­ers com­ing to the UK for clas­sic cars, which will be a boost to our econ­omy but will mean cars leav­ing the UK. How­ever, econ­o­mists never saw the 2008 crash com­ing so we can’t rely on them now.’

Richard Truett, in­dus­try edi­tor of the Detroit-based Au­to­mo­tive News mag­a­zine and se­rial buyer of Bri­tish clas­sics, be­lieves it will be a buy­ers’ mar­ket State­side. ‘It isn’t just cars that will be cheaper if the pound holds at 1.32 to the dol­lar. Ship­ping from the UK will also go down. While most Amer­i­cans who pay at­ten­tion to Euro­pean news are very con­cerned about Brexit, clas­sic car buy­ers and spares deal­ers here are prob­a­bly re­joic­ing – if they are look­ing at ex­change rates. The money they pay has dropped, but the prices they charge will very likely re­main the same.’

Gary Dicks of Som­er­set-based clas­sic French car im­porter 2CV Im­ports is wor­ried that ex­change rates will cause clas­sic car val­ues to fluc­tu­ate and im­ports to be­come pro­hib­i­tive. He says: ‘If the re­la­tion­ship be­tween the Euro and Ster­ling changes it will affect our busi­ness costs – fer­ries, fuel, and the cost of buy­ing the cars in France. We’ll have to pass this on to the cus­tomer so our im­ports will get pricier, as will those 2CVs, Dyanes and so on in the UK. In the case of pop­u­lar ve­hi­cles like H vans, prices will rise to the point where en­thu­si­asts may have to con­sider other ve­hi­cles – in turn strength­en­ing their prices.’

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