- Reeves to take aim at Motability?
- FCA car loans: lenders fight back
- Ferrari blames plunging RVs on UK non-dom changes
- William Morgan loss in year of ‘significant change’
- WEEK AHEAD: Inchcape trading announcement
- More hints on VAT cut for home energy
- Oliver Blume to exit Porsche – but VW contract extended
- TrueCar to go private
- Trump auto tariff relief extended
- OPINION: FCA under pressure
Reeves to take aim at Motability?
Chancellor Rachel Reeves is examining reforms to the Motability Scheme that could save £1bn in the November budget but impact new car registrations.
Reeves is understood to be exploring reforms including scrapping tax breaks by reducing an exemption by which cars leased under the scheme do not have to pay VAT or insurance premium tax.
The Times also reports that so-called ‘luxury’ vehicles, such as BMWs and Mercedes-Benz, could be removed from the scheme.
“Reeves is said to be less likely to go further next month and restrict which benefits recipients are eligible for free cars. But such moves are being examined as part of longer-term reforms to reduce incentives to claim, and deal with mounting criticism of the scheme.”
MPs are reportedly nervous about the proposed changes after they revolted during the summer over Reeves’ planned £5bn in benefit cuts, which the chancellor ultimately abandoned.
The Times reports government sources insisting the reforms “were about fairness rather than purely cost-cutting”. They pointed out that Motability made a £748m profit in 2023 and its chief executive was paid £658k in 2024. However, Motability also made a £565m in 2024.
“Taxpayers give £2.8bn a year to Motability,” says The Times.
FCA car loans: lenders fight back
Car finance lenders are in a “stage of rage” following the FCA’s 400-page consultation on the motor finance compensation scheme, reports The Times.
“Cerebral” chief executive Nikhil Rathi has “found himself in a very public line of fire. Financial firms rarely – if ever – take aim at their regulator; this time, they were lining up to do so.”
FirstRand, Lloyds and Close Brothers have all criticised the FCA’s methodology. “By the end of the week, the industry was locked in a full-blown conflict with Rathi.”
There are now rumours some lenders could exit the market, leading several in the industry to warn of “transport poverty” where people are left unable to buy cars needed for essential journeys.
The FCA has insisted it thinks this unlikely.
* Read Auto Sunday editorial director Tristan Young’s opinion on the FCA under pressure
Ferrari blames plunging RVs on UK non-dom changes
Declining RVs of Ferraris in the UK has led the firm to cut the country’s allocation, reports the FT. Chief executive Benedetto Vigna blamed the departure of wealthy individuals following the abolition of non-dom status.
“Some people are getting out of that country for tax reasons,” he told the FT. “What I can tell you is that we see a stabilisation over there,” after the company reduced its UK allocation.
The non-dom tax regime ended in April. Vigna said “a lot of people” had left the UK, reported the FT.
Autotrader says RVs for the Ferrari Purosangue fell 12.2% between January-October, while SF90 Stradale RVs fell 6.6%. “However, prices have started to stabilise in recent months.”
Ferrari RVs have fallen in other markets too, due to an increase in customisation, “which makes it harder to sell to a second-hand buyer”.
Ferrari shares have fallen 17% since the brand said last week its profit margin would remain largely flat over the next five years.
William Morgan loss in year of ‘significant change’
William Morgan Group has reported a loss of £72k in the year ended December 2024, down from a £2.7m profit in 2203. Turnover fell slightly, from £229.8m to £226.1m.
The BMW, Mini and BMW Motorrad retailer said the results reflected a “year of significant change” as it redeveloped its Northampton site and expanded its portfolio with the introduction of Ineos.
The Wollaston branch reported robust trading but there was a “difficult year at North Oxford Garage with performance below internal budgets and the year prior… significant changes have been made across the business in response”.
WEEK AHEAD
Tuesday, public sector net borrowing
Wednesday, CPI and RPI
Thursday, Inchcape trading announcement
Friday, GFK consumer confidence
Friday, UK retail sales
DATA INSIGHT
More hints on VAT cut for home energy
£200: How much the average household energy bill has risen since 2019. This weekend, energy secretary Ed Miliband gave the strongest hint yet that the chancellor could cut VAT from household energy bills at next month’s budget, reports the FT.
Oliver Blume to exit Porsche – but VW contract extended
2030: New agreement for Volkswagen Group CEO Oliver Blume to remain in place, starting January 2026. His dual role with Porsche AG will also cease then; former McLaren CEO Michael Leiters is set to succeed him.
GLOBAL AUTO
TrueCar to go private
Struggling US marketplace TrueCar is to be taken private by founder and former CEO Scott Painter, reports Automotive News. He is leading a syndicate of investors, known as Fair Holdings Inc, in a $227m deal. The all-cash deal is expected to close in Q4 or early 2026. Painter will return as CEO.
Trump auto tariff relief extended
Donald Trump has extended a tariff reprieve from two years to five for American-made vehicles. OEMs can claim an offset worth 3.75% of the value of US-made vehicles, to offset the 25% duties on imported parts. It is intended to provide time for supply chains to be shifted to the US, reports Automotive News.
OPINION
FCA under pressure
It’s great to see the UK governmental process in full swing this week when the House of Lords quizzed the FCA leadership about its handling of discretionary commission arrangements and the proposed redress scheme.
Last week also saw a statements from MotoNovo owner FirstRand and the Finance and Leasing Association hitting out at the FCA’s handling of the consultation.
Both the House of Lords financial services regulation committee and the banks pursued the same themes, that the FCA wasn’t doing enough in terms of regulation at the time and how the redress scheme is now being constructed.
The House of Lords committee hit out at the both the timeframe involved (going back to 2007) and the lack of specificity governing the criteria for redress.
When the Supreme Court ruled on the three test-cases earlier this year, it was at pains to point out that each case should be treated on its own merits. What the FCA is doing in terms of the redress scheme does not follow this thinking.
FirstRand’s statement went as far as to say: “The group’s initial view is that the scheme appears to have moved beyond the group’s expectations of what can be considered proportionate or reasonable.
“The presumptions of unfairness in the scheme in its current form does not appear to be applying the legal clarity provided by the recent UK Supreme Court, which stated that unfairness should be assessed on a combination of multiple, specific facts.”
It’s rare to see a specific statement on DCAs from a finance providers in the UK, so FirstRand’s attack on the FCA must be taken seriously.
The FLA joined in too, stating: “The remedies in the motor finance redress consultation are so broad that they will compensate customers who suffered no loss.”
As I wrote last week, the finance industry isn’t going to take a potential £11 billion level of compensation sitting down. I suspect that this is only the first stage in the fightback by the banks.
Tristan Young
Editorial Director
Get in touch: tristan@autosunday.co.uk
ISSN 2977-6597