Price of new cars like Ford Fiestas, VW Golfs and Vauxhall Corsas rising, along with petrol prices, placing more pressure on households, says Uswitch
Drivers trying to buy a new car face paying around £10,000 more than they did a decade ago.
Alongside rising food and energy prices, the cost of owning and running a car, is also among the outgoings now placing significant pressure on household finances.
The price of some of the UK's most popular vehicles is currently increasing up to three times faster than earnings.
And with the cost of second hand cars also being pushed up because of the pandemic, alongside the ongoing high cost of fuel, motorists pockets are feeling the pinch.
According to figures released by Uswitch.com, some of our favourite vehicles including Ford Fiestas, Vauxhall Corsas and VW Golfs are close to costing double what they did a decade ago, while people's salaries have not been rising at the same rate.
Top of the list is a Volkswagen Golf, which the comparison site says is around 72 per cent more expensive to buy than it was 10 years ago – leaping from around £13,000 to more than £23,000 for a new model.
Once a popular first car for many a new driver the cost of a new Ford Fiesta has also sky rocketed in the last decade.
Costing between £9,000 and £10,000 for a new vehicle in 2011, depending on the specification, anyone wishing to place an order for 'the country's favourite car' today may face a bill of closer to £17,000 says motoring experts, which is a rise of almost 70 per cent.
Vauxhall Corsas and Astras and the Ford Focus are also among the most popular cars to have significantly increased in cost says Uswitch, pushing them past the budget of many drivers, with average annual salaries rising by just 22 per cent in the same period – from £21,100 in 2011 to £25,780 in 2021.
And the news may not be much better for those drivers needing a new vehicle and considering choosing a second hand car rather than a new one in an attempt to avoid the escalating prices.
The UK is currently also noticing a sharp turnaround in the value of second hand cars, that traditionally depreciate in value the minute they are driven from the car garage forecourt.
A slow-down in new car production over the last 18 months because of the global pandemic and subsequent problems in obtaining particular new car components that is contributing to long waits for new motors, combined with pent-up demand from people now needing or wanting to replace their vehicle since lockdown, has seen the cost and demand for older vehicles rise considerably rather than fall.
Figures released by Auto Trader suggest that used car prices have risen by more than 15 per cent year on year with some vehicles rocketing by almost 50 per cent – again surpassing any increase is most people's pay.
An increase in the price of second hand cars was also attributed to July's rise in inflation, with the Office of National Statistics suggesting that a desire by commuters to avoid trains and buses because of coronavirus fears, was also contributing to the demand for second hand cars and therefore ramping-up sale prices.
Joel Kempson, car insurance expert at Uswitch.com said the price rises would mean many people will struggle to afford a car.
He explained: "With the purchase price of popular cars having risen at a faster rate than our average wages, it could mean that more people will struggle to afford a vehicle, especially first-time drivers."
But it is not just in the price of cars that mean drivers face a relentless pressure on their finances. Diesel and petrol prices are also now being added to the list of escalating costs households are having to negotiate.
The RAC, which issued strong warnings about the escalating cost of fuel this summer, has revealed through its price monitoring initiative Fuel Watch that prices are now very close to some of the highest prices seen during the last decade.
The average price for a litre of diesel at the pump this month is now around 136p and 135p for a litre of unleaded petrol.
In 2012, when prices were considered to be at some of the highest, the cost of a litre of diesel was 142.4p and petrol 136p, meaning that a litre of unleaded is now very close to reaching those sky-high levels again.
And while there was little change to prices in August after eight months of consecutive rises, providing a little respite, RAC spokesman Rod Dennis says that the future price structure remains unclear.
He explained: “A full nine months of continuous price rises finally came to an end in August, but that’s really no comfort at all to drivers who have been paying considerably more to fill up this summer than last year.
“While an end to rising prices is to be welcomed, it remains the case that there’s little immediate sign that pump prices are actually going to come down. Key to what happens next is how the oil price changes.
"It’s a picture we need to continue to monitor closely, particularly if oil again begins to creep up to near the $80 a barrel mark as it did in July.
“What isn’t in dispute is just how much more expensive this second ‘staycation’ summer has been for drivers compared to 2020. With so many of us covering long distances this year, the effect of paying around 20p more per litre for petrol and diesel is likely to have been widely felt.”