Car prices hold firm despite pound's fall but Carpetright and Hornby are stymied

CAR buyers will be shielded from the pound’s post-Brexit slump as manufacturers look to protect their share of Europe’s second-largest market, the boss of the UK’s biggest dealership, Pendragon, said today.

Chief executive Trevor Finn said manufacturers were expected to offset higher car prices with lower interest costs in the financing deals offered to customers in monthly payments on the bulk of new car purchases, meaning little “material effect” on prices.

Manufacturers would be reluctant to cut volume in a country which sells 2.7 million cars a year while makers “have typically hedged currencies for up to 12 months in advance”, he added. Profits and sales are up and there has been “no behavioural change from customers”, said Finn, leaving profits in line with expectations for the full year.

Carpetright, however, is a “slave to foreign exchange rates” according to boss Wilf Walsh, who says the price of some carpet ranges has gone up 8% since the referendum. It sources 60% of its products from Europe and is looking at other suppliers in the UK and Turkey. The shares eased 2.75p to 193p.

Model trains maker Hornby, which makes its models in China, is putting up the cost of its trains to retailers by 10%. It has been hit by the 17% fall in sterling against the dollar since Brexit.