Car price inflation up to 8.5%

The price of some top-selling cars has risen well above the
inflation rate over the last four years, according to Which? magazine.

Some of the rises, including those for the Volkswagen Polo and the Renault Megane, have been 8% or more above inflation, the magazine said.

Other models, including the Mini (down 2.5%) and the Ford Galaxy (down 5.5%) have dipped in price, with the BMW Series going down 7.5%.

Which? said: "It's disappointing to find some manufacturers are hiking the price of new cars above inflation, especially smaller cars, at a time when consumers are already feeling the pinch due to the rise in VAT, car tax and general cost of living.

"However, we're surprised to find that some cars are now better value than they were four years ago - so there are some bargains around."

The magazine compared prices in real terms in March 2012 with those in March 2008 for 20 best-selling models.

To remove the effect of external factors, Which? excluded VAT, the first year's car tax and the registration cost, as these had all changed over the period.

It then inflated the March 2008 price by 14.53% - the increase in the CPI inflation rate from March 2008 to March 2012.

Which? said that based on the difference in pre-tax prices, after adjusting for inflation, the Volkswagen Polo 1.2 70 Match had gone up 8.5% in the four-year period, while the Renault Megane 1.5dCi (106) Expression had gone up 8.5%.

Two Vauxhall cars - the 1.9 CDTi diesel and the 1.9CDTi Elite diesel - had both gone up 7.5%.

But the BMW 3 Series 320D diesel went down 7.5% and the Ford Focus 1.6 Zetec dipped 5%.

PA