Now we all know that the nation has voted to leave the EU, our thoughts turn to what the implications could be for “Brexit motoring.”

As per our last news item, petrol and diesel prices are widely expected to rise, at least in the short term – something people are already beginning to see (although not yet to the level some people predicted). However, there’s far more to motoring than the cost of fuel.

Many media outlets and national newspapers have begun to discuss other implications for UK drivers, so we thought it would make sense to give some space to some of the theories and suppositions. It’s very important to remember that when it comes to Brexit motoring, even the most informed opinion can only really be described as speculation at this stage.

No formal “Brexit” negotiations have yet taken place, so our exact relationship with most of mainland Europe is yet to be determined. However, it is possible to consider some of the EU’s current impacts on motorists and get a good idea of what could change.

Brexit Motoring: Insurance

Car insurance is arguably the thing that will be most affected by our planned withdrawal from the European Union, for a couple of reasons. One headline theory is that it could actually get cheaper – at least according to some pundits.

Why IS this? Well at the moment, it’s mandatory for UK car insurance policies to provide for a minimum level of legal cover when cars are driven in EU countries. If we’re no longer part of the EU, it’s possible that insurance companies could pass on the savings in not having to provide this cover, in the form of lower premiums.

However, this will mean that those who do wish to drive on the continent will have to pay separately (as many drivers already do to ensure a comprehensive level of cover) – and if we’re not part of the EU, these extra insurance costs could be high. So, reading between the lines we have a speculative advantage for drivers who never drive outside Britain, and a potential extra cost for those who do.

There’s more: As explained in a This is Money report, a law changed back in 2012 following an EU ruling, preventing insurance companies from offering cheaper policies to drivers based on their gender. This saw the end of a trend that was allowing (statistically safer) female drivers to pay less for car insurance than men. If an independent UK decides not to maintain this legal provision, we could see cheaper insurance for women once again, but probably more expensive insurance for men.

Driving in Europe Post Brexit

As (contrary to the understanding of many) the UK has never been part of the borderless Schengen zone, there have always been passport controls between the UK and mainland Europe (the border between Northern Ireland and the Republic of Ireland being an exception).

As such, this part of driving in and out of Europe will remain unchanged, whatever is eventually decided regarding freedom of movement. However, once we leave the EU, we will no longer be able to fill our cars with cases of wine and cheap tobacco. It will likely be possible to buy small amounts at even lower prices, but within the same strict limits that apply to true “duty-free” purchases in places like Australia and the USA.

Ensuring these limits are adhered to is likely to make crossing out of Europe rather more arduous and time-consuming than it is now, but this change could be offset by fewer people crossing these borders once the “booze cruise” days are over.

Unless other European countries leave the EU, road laws will remain consistent. However once Britain is no longer part of the EU, the country may well choose to amend some motoring laws on this side of the Channel.

Brexit and the Car Industry

The impact Brexit may have on car manufacturing, and the car industry in general, is where things become really speculative. As you will know if you watched any of the pre-Brexit debates, the car industry was used repeatedly by both campaigns as a political tool to influence voters.

It’s too early to speculate on what might happen regarding manufacturing (even though plenty of newspapers are attempting to!) Until Brexit negotiations are well underway, it’s almost impossible to accurately predict whether manufacturers might move factories or whether the EU may impose trade tariffs.

However, we can still have a think about what could happen to car prices in the short to medium term. According to the same report referred to above, The RAC believe there’s “little evidence” that buying a car will become any more pricey. This is referring to the interim period while negotiations get underway.

After Brexit is complete, things could change; If we don’t negotiate a good trade deal, car prices could go up, resulting in cars here costing more than in mainland Europe. Toyota is one manufacturer who’s been open about this.

Also, while there’s not yet been any sign that interest rates will rise (and, in fact, speculation that they could fall yet further), if they do go up it could mean that car finance deals get a little more expensive.

Brexit Motoring Conclusion

You’ll notice we’ve been very cautious to only summarise some of the most common theories relating to Brexit motoring. It’s well worth emphasising that a huge number of factors remain up in the air at the time of writing, so informed speculation is the best we (or indeed anyone else) can offer. Whatever happens, nothing’s going to change particularly quickly at this point.

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