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New car prices rose by 3.9% in the year to October

Average retail prices for new cars in the UK rose by 3.9% over the 12 months to October 2003, according to the latest European Index of New Car Prices published by eurocarprice.com in association with PricewaterhouseCoopers.

The movement in retail prices in the UK was 0.4% weaker than across Europe as a whole, where the average price rose by an average of 4.3% in the year to October.

New car retail prices in the UK are the same as the average price of a new car in the euro currency zone. New car retail prices in the euro currency zone rose 4.5% in the year to October.

Of the 19 countries covered by the eurocarprice.com retail price index, Poland experienced the greatest increase in retail prices, which rose by 11.9% during the 12 months to October 2003. At the other end of the scale, retail prices in Finland fell by 3.3%.

Charles Seguin, PricewaterhouseCoopers AUTOFACTS Retailer Capabilities Division leader, said: “The pricing movements show the effect of supply and demand in the overall automotive marketplace. With the number of new models being introduced and the competitive nature of the industry, market prices are performing as expected. It is too early to tell whether the intent of the changes to Block Exemption Regulations of increased retail competition will result in lower prices for consumers. Quite the opposite seems to be occurring.”

eurocarprice.com also tracks movements in pre tax prices in the euro currency zone and some other markets. Average pre-tax prices for vehicles in euro currency countries rose by 3.9% in the 12 months to October - a slight strengthening of the price trend.

Pre-tax car prices in the whole of Western Europe (euro and non-euro currency markets) rose 0.3% in the year to October compared to a fall of 0.1% in the year to September. Relative to average car prices in the euro zone, Greece has the lowest pre-tax prices for cars, at 14% lower than average. Switzerland, where pre-tax prices are 14% higher than the euro zone, has the highest relative pre-tax prices.

Price performance in the volume segments has improved slightly since September. The average pre-tax prices for mini and small segment cars in Europe are now 1.2% lower than a year ago, while prices for lower medium models have lifted from 2.1% lower to 0.6% lower.

Price trends are generally less positive in other segments, with the exception of the sport coupe. Here the average price has been increased by the Mercedes CLK moving from a share of 16% of segment to 31% of segment. Increases in the luxury segment, which were in double figures until recently, have weakened to an average of 2.9%.

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