What the Spring Statement Means for Repair Centres and Dealerships

Chancellor Rachel Reeves’ recent Spring Statement outlined government plans to boost the UK economy, revamp public services, and strengthen national security. Several policies could impact the automotive and repair sector, from infrastructure investment to changes in personal finances. These measures may shape the future of repair shops and dealerships across the UK.

At A Glance:

• Economic growth is expected from 2026, driven by fiscal stability and consumer confidence.
• Retaining the fuel duty freeze keeps petrol prices steady, encouraging more driving.
• Real wages rising and inflation set to drop could boost disposable income for repairs.
• Infrastructure investments may include road networks and transport hubs.
• Broadening of digital tax changes (MTD) encourages clearer financial and tax management.

Economic Stability and Consumer Confidence

The UK and the wider global economy have faced significant challenges in recent years, but the Spring Statement brings some optimism. The government’s forecast suggests steady growth from 2026 onwards, driven by new fiscal rules aimed at balancing government spending with revenue. It is also working to reduce national debt as a share of GDP.

According to the Spring Statement, real wages have been rising at their fastest rate in over three years. Inflation peaked at 3.8%, but forecasts suggest it will drop to around 2% by mid-2026.

Consumer Confidence and Auto Repairs

Consumer confidence and income significantly impact repair centres. When people feel financially secure, they are more likely to get their cars serviced regularly and invest in non-essential repairs. With wages rising and inflation coming under control, drivers may be less inclined to delay maintenance.

However, challenges remain. Despite positive news about wages and inflation, rising energy bills and a high cost of living continue to affect personal finances. This could mean that, for many, economic difficulties persist.

The Fuel Duty Freeze Remains

The UK Spring Statement did not introduce new policies on fuel duty but reaffirmed the government’s commitment to freezing it. This decision, made in the Autumn Budget, is good news for motorists and repair shops alike.

Keeping fuel duty frozen means petrol prices remain lower than they might have been. This leaves drivers with more disposable income, potentially increasing spending on car maintenance. Additionally, cheaper fuel encourages more driving, which can lead to increased demand for repair services.

Infrastructure Investments

The Chancellor announced an additional £13 billion in capital infrastructure funding as part of the Spring Statement, adding to the £100 billion already allocated. While most of this is earmarked for housing and green energy, the government has emphasised investment in communities beyond housing alone. This could include road improvements, transport hubs, and other projects that may impact the automotive and repair sectors.

Tax and Business Regulations

The Spring Statement addressed tax reforms, with the government aiming to close tax loopholes and crack down on fraud. A key component of this strategy is the expansion of Making Tax Digital (MTD).

MTD is set to roll out for income tax Self Assessment from April 2028, applying to self-employed individuals and landlords earning over £20,000 annually. Transitioning to digital record-keeping now could help businesses streamline financial management and improve efficiency.

Bridging the Skills Gap

The Spring Statement placed significant focus on vocational training, particularly in the construction sector, with £625 million allocated to train 60,000 new workers. While this funding is construction-focused, it signals broader government support for vocational skills development.

Over time, this could extend to the automotive maintenance and repair sectors, particularly as demand for electric vehicle (EV) expertise grows. The government’s commitment to achieving net zero suggests that further investment in EV repair and maintenance training may follow.

Looking to Stay Ahead of the Curve with Flexible Finance Options?

As the economic landscape evolves, offering customers a simple, affordable way to pay for repairs is more important than ever. That’s where Payment Assist can support you. We help repair centres and dealerships provide customers with flexible payment solutions, allowing them to manage unexpected costs without delaying essential work.

With our 0% finance options, your customers can spread the cost of repairs into manageable instalments. This reduces the burden of large upfront payments, making necessary repairs more accessible. Plus, you receive full payment upfront, ensuring stable and secure cash flow.

Get ahead today! Sign up for Payment Assist or contact our team to learn more.

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