Interest rate cut ‘could fuel garage investments’

UK garages could benefit from yesterday’s cut in the interest rate by a quarter of a percentage point, say industry leaders.

The Independent Garage Association welcomed the Bank of England’s rate cut from 5.25% to 5%, saying the move was positive news for its members and the sector as a whole.

IGA chief executive officer Stuart James said the cut may help reduce borrowing costs and improve cash flow for independent garage owners, potentially making it easier for them to invest in their businesses.

“It is a step that could support the growth and stability of garages across the country, assisting them in managing rising costs and maintaining their service to customers,” James said.

Sue Robinson, chief executive of the National Franchised Dealers Association said the rate cut — the first since 2020 — brought “cautious optimism” for the coming months.

Robinson said the automotive sector had “demonstrated remarkable resilience, weathering a period of high inflationary pressures”. 

Last month, SMMT chief executive Mike Hawes said trade partnerships and international investment were among key priorities needed to boost the UK’s automotive sector.