July 25, 2024

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Consumer spending on car purchases has risen three times faster than for public transport journeys, new figures show.

Around £57.4bn was spent in the UK on new and used cars in 2023, up 6% on five years earlier, according to AA analysis of Office for National Statistics data.

By comparison, consumer spending on public transport – including rail, buses, flights and taxis – was £60.9bn, representing a 2% increase on five years ago.

AA head of roads policy Jack Cousens claimed the figures highlight how vital motoring was for people in the UK, as well as the country’s finances.

He said: “These latest ONS figures underline the UK’s reliance on cars and the huge amounts of money they generate for the economy – not to mention VAT on that spending, and other tax.

“Cars are not just necessary but essential on so many levels. Even if a significant amount of car use was transformed into take-up of public transport, the impact on the economy and other income generation would be dramatic.

“Just think how much councils would lose if a high percentage of cars stopped turning up to their car parks or needing parking permits, and getting fined.

“The key question is whether what consumers spend on cars would translate into income for public transport and cover the cost of infrastructure investment to enable that.

“It seems that getting travelling consumers to fork out for their own transport and its maintenance, and then tax the heck out of them, is a pretty good deal for the public purse.”

Running a car also accounted for a large chunk of the £78.6bn spent on what is described as the operation of personal transport, with spending on fuel and lubricants up 20% since 2018 to £41.7bn.

New car purchases down

But despite the fact more consumers are spending money on cars than on public transport, the number of purchases of new cars by private buyers has declined for nine months in a row, new figures show.

The Society of Motor Manufacturers and Traders (SMMT) said 67,625 new cars were registered by private consumers in June, down 15.3% from 79,798 during the same month last year.

Ian Plummer, commercial director at Auto Trader, said: “With average new car prices rising almost 40% over the last five years, it’s clear cost is the culprit.

“Manufacturers are responding with discounts but they’re failing to keep pace, which is forcing many buyers to opt for a used alternative.

“Whoever forms the next government needs to address electric car affordability and provide long-term stability for the market.”

Environmental impact

Despite comments from the AA, the billions of pounds spent by consumers every year on cars is having a clear effect on UK roads – where overall traffic levels in 2023 were 2.2% higher than the previous year.

More cars on the roads means more air pollution, which is among the biggest environmental health risks facing people in the UK.

Burning petrol and diesel fuel creates harmful by products like nitrogen dioxide and carbon monoxide, while vehicles emit carbon dioxide, the most common human-caused greenhouse gas.

Even electric vehicles produce particulate matter from the friction between their tyres and the road.

Researchers from University College London estimated that 48,625 adults die prematurely each year in the UK due to particulate matter pollution. 

Presently, 79% of the UK exceeds the World Health Organization’s (WHO) annual mean guideline for safe fine particulate matter levels. 

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