Britain's exit from the EU continues to bite the automotive industry.

Since Britain voted to leave the EU, car finance costs have increased by nearly half according to new research from Parkers.

The Sterling has dropped from more than 1.3 euros to the pound in May 2016 to less than 1.1 euros this month, which is said to be behind the 49 percent rise in finance costs, which leave UK drivers out of pocket by as much as £98 per month – or £4606 over the course of a full finance contract.

Monthly payments have increased more than one-and-a-half times as fast as the overall cash prices for cars.

"With more than 90 percent of privately purchased cars being financed, potentially millions of drivers could be in for a shock when they come to replace their car," said Chris Lloyd, Parkers finance editor.

Filling out lease agreement with calculator and expenses

"Consider the fact the average UK household spent £900 more than it earned in 2017, and hundreds of thousands of families could find themselves priced out of the new car finance market – with the inability to stomach higher monthly bills and no savings to put down a bigger deposit to shrink the instalments."

Parkers' study looked at 14 different cars, finding increases with all of them. Someone who has a small car on a PCP deal could expect their costs to go up by somewhere between £200 and £234 each month.

City cars present an even more worrying trend, with one unnamed model presenting a leap from £76 to £113 per month in just two years, which is an increase of 48 percent.

2017 Fiat Panda

"Parkers research reveals that costs are increasing so fast that drivers who are tied into finance contracts currently may not be able to afford to finance the same car next time around (assuming the same contract terms)," Lloyd said. "A Fiat Panda city car that would have set you back £119 per month two years ago is now £153 per month for new customers – despite being one of the oldest small cars still on sale and scoring a zero-star safety rating."

"Sign up for a new Panda today, therefore, and that same car could cost you an additional £1,580 over the four-year contract compared with someone who signed the contract in January 2017."

BMW 116d ED

At the other end of the small car spectrum, a diesel BMW 1 Series would lead you to fork out an additional £98 each month, adding £4,606 on the overall price of the car.

"We’re facing a period of economic uncertainty, whatever form the Brexit process takes. If you’re looking to buy a new car, do your best to make sure you get the best deal you can," said Keith Adams, Parkers editor. "Yes, prices are rising, but carmakers also want your business, and will be open for business. Make sure you make the most of this – and also make sure you don’t bite off more than you can chew."

Model

Cost per month - 2017

Cost per month - 2019

Difference over full contract

 

 

 

 

Fiat Panda

£119

£153

£1,580

BMW 1 Series

£200

£298

£4,606

Vauxhall Mokka X

£276

£317

£1,438

Vauxhall Astra

£297

£324

£951

Ford Focus

£259

£229

-£619