New car prices slip back in July

New car prices fell in July, for the fourth time in the past year.

But the drop was just 0.23 per cent, or £65 on the average cost of a new car, and prices are still higher over the year.

The slide was almost twice that of the previous largest drop in prices, in December when they fell back by 0.12 per cent. November and April also saw prices slipping.

However according to the latest figures from the New Car Price Index compiled by DrivenData, parent company to CarandVanNews, prices since July 2010 have risen 3.9 per cent, equivalent to £1,056.76. The average cost of a new car is now £28,147.00.

Slightly better news for consumers is the pace of new car inflation, which over the past year has slowed to 3.9 per cent. Between July 2009 and July 2010 car price inflation rose by 4.718 per cent.

Editor-in-chief of DrivenData John Blauth questions whether the latest slip is merely a blip in a rising market or the start of a stabilisation to be followed by a consistent gentle falling in prices.

“Fuel costs also fell, very slightly, in July. Dare we conclude that motoring may be getting cheaper?” Blauth says.

He argues that the cost of motoring against travel by rail still works out as exceptionally good value; “particularly in the summer when schools are closed and traffic levels are low. From time to time in August driving could almost be called a pleasure!”

Words by: Andrew Charman