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Under new laws that come into force from 24^th April 2017 most serious speeding offenders will be fined 50% more. The Sentencing Council has issued new guidelines to be implemented in all magistrates’ courts in England and Wales.

At the moment the most serious speeding offenders face fines that have a starting point of 100% of their weekly salary, this will go up to 150% of weekly salary (no I didn’t either). The upper limit doesn’t change though which clearly favours the better off amongst us.

The upper limit remains at £1,000 or £2,500 for those caught on a motorway. Again, in my opinion, arse about face. Speeding in a built up area should carry a bigger fine than on a motorway. As 10 times more people die on country roads (60% of total) it doesn’t make sense to penalise motorway speeders more than non motorway speeders.

A speeding offence is considered to be serious if you are caught driving at 51 miles per hour in a 30mph zone, 66mph in a 40mph zone,  or 101mph on a motorway etc. Some experts are calling for 3 month bans applied to those driving at speeds that drop them into the serious speeding zone.

I believe that would have a greater affect on those who speed but is it the answer – I really don’t know. For information the average fine in 2015 was just £188 with 166,695 offenders being sentenced. By Graham Hill

MOT tests do not prove that a car has no faults. On many occasions I have written about this issue and explained how buyers have been handed a brand new MOT certificate with their used car as proof that the car is faultless. Most safety items are checked along with emissions but it won’t reveal that a car has an oil leak or any other mechanical fault unless it falls within the scope of the test.

A full mechanical check on the car should confirm if the car has a faulty gearbox or engine or any other potentially expensive faults. Having said that the scope of the MOT test is extending annually to include new technology which also means that examiners are expected to take an annual, online, test. However, it has been revealed that just 35% of MOT testers have taken their test with just up to the end of March to pass.

Following which the testers will put their licence in jeopardy. The question is does this put drivers at risk if the MOT tester isn’t up to speed with the latest requirements? The Driver and Vehicle Standards Authority (DVSA) thinks not as they have announced that the examiners will be treated leniently this year, as this is the first year of change and the online examinations, but a tougher approach will be taken in future if examiners don’t conform to the new rules. Concerns have been raised regarding driverless cars.

Development in this sector is gaining traction but concerns have been expressed by various bodies regarding the preparation, or rather the lack of it, when it comes to the safety testing and MOT test criteria in relation to autonomous cars fitted with extra sensors and complex electronics. The Department for Transport simply says that work in this area is ‘under review’. Finally on the subject of MOT testing the Department for Transport has finally launched its proposals to extend the first MOT test from 3 years to 4 years.

The consultation paper recommends that the initial MOT test for cars and motorcycles be extended to 4 years from 2018 saving motorists more than £100 million annually. Transport Minister Andrew Jones (no I haven’t heard of him either) suggested that our roads are some of the safest in the world and vehicles are much safer than they were 50 years ago when the MOT test was set at 3 years.

Personally I would suggest that we need to see how many cars fail their first MOT at 3 years before deciding if we can extend to 4 years. Strange that wasn’t mentioned. By Graham Hill

As most of us know you can give the same set of statistics to two different people and they will each read something completely different into them. Let’s take the way you will finance your next car, assuming it’s a new car. Statistically around 87% of new cars financed by consumers were financed on a Personal Contract Purchase (PCP) with around 6% financed on Personal Contract Hire (PCH).

So you may draw from the statistics that by far the best product is PCP as 87% of the market can’t be wrong. Let me explain that PCP is the most popular amongst car dealers, that’s why it is the most popular amongst consumers – they’ve been sold to! And, as has been reported widely recently, there is a grave lack of education amongst consumers when it comes to financing one of their biggest financial commitments – their car.

PCP has replaced HP as the most popular way to finance your new car, let me explain why – it makes the lender and the dealer more money even when the most toxic measurement ever created, the APR, is exactly the same on the same car. At this point you may be aghast.

Let me give you a quick example, you see a car that costs £22,000, you put down a deposit of £2,000 and look to finance the car over 3 years with the intention of owning the car after 3 years and, if it is still OK, running it for maybe another 2 years. But currently the cash flow is a little tight so you need to look at the figures. Let’s look at HP based on 36 payments with you owning the car after 3 years. And to keep it simple we’ll work on an APR of 10% assuming also that there are no additional fees and charges.

The monthly figure calculates out to be £645 x 36 payments = £23,220. OK, now let’s look at a PCP with the loan amount being the same, £20,000, APR the same at 10% and a final payment of £10,000 to own the car, the monthly figure calculates out to £406 per month. Wow a monthly saving of nearly £240! But if you then pay the final figure and own the car in the same way that you owned the car at the end of the HP agreement you pay 36 x £406 = £14,616 + final payment of £10,000 = £24,616, a whopping £1,396 more in interest charges.

You can answer the question yourself – which product do you think the lenders and more importantly the dealers want to push you into? You may be paying substantially less per month and the same APR but the extra interest represents an extra 7% on the amount financed. But now let’s look at a headline, ‘Personal Contract Hire (PCH) is the fastest growing method used by consumers to finance new cars.’ Sub heading: ‘The take up of PCH has more than doubled over the last 18 months’.

Yes it has, 18 months ago it only accounted for 2.5% of the finance used by consumers to finance new cars it is now at 6% and growing so you could conclude from the headlines that PCH is the way to go. But you are unlikely to  see these headlines as dealers don’t like PCH as they have to sell their cars at rock bottom prices with some leasing companies restricting their finance commission to just £200 per car.

So you won’t see dealers falling over themselves to sell you a PCH on a car, even though it may be substantially cheaper than a PCP, but rather selling you into the idea that you could own the car at the end of a PCP, something you are not legally entitled to do at the end of a PCH (although some leasing companies will sell you a car at the end of a PCH at trade value if asked).

In truth only 20% of those who take a PCP actually buy the car at the end of the agreement with most of those using the car as a part exchange as there is some equity in it so the idea of owning the car at the end of the agreement as important is in fact a nonsense – the stats prove it! Finally, in an even more favourable twist in favour of consumers, many fleet operators are complaining that consumers are sometimes being provided with better deals than they are.

That is because the manufacturer and dealer can give away up to 45% in combined discount and bonuses on stock that needs to move to make way for new models, to keep production lines moving, or as a PR exercise to get more brand awareness out there. The problem with this is that when the cars go or they hit their target the deal disappears with monthly rates increasing by as much as £200 + VAT per month.

On the other hand fleets don’t want huge fluctuations in rates, it throws their budgets out. A fleet may have negotiated a deal on Golfs at £200 + VAT per month only to see a batch being offered at £169 + VAT to consumers. However, after the promotion, it wouldn’t be unusual for the consumer rate to jump to £269 + VAT but whilst the deal lasts the consumer has had a bloody good deal! By Graham Hill

Contract Hire or car leasing as some people call it can be very confusing because you can’t always apply what you may consider to be logic. Let’s take metallic paint for example. Some leasing companies will provide you with free metallic paint and given the fact that metallic for most cars costs north of five hundred quid you’d be silly not to take it. But are they actually being generous?

No they’re not because careful scrutiny of some quotes that I run shows that the addition of metallic paint, whilst increasing the cost of the car actually drops the monthly rate. A recent BMW quote dropped the rate by £6 + VAT per month when I added metallic paint.

This may sound daft but it’s all down to the resale value at the end of the agreement. A prestige car with metallic paint is much more desirable in the used market than a solid colour car and this is often reflected in the prices achieved through auction. So from the leasing company’s point of view, whilst they may have to pay an extra £400 for metallic after discount they could be £7-800 better off when they sell the car in 3 years time.

The same can apply to the spec. of the car. We have had a number of deals over the last few months where a better spec car can be leased for less than an entry level car. This can be partly because some extra discount has been given by the manufacturer but is often because of the desirability of the car through auction.

Some examples are the Jaguar XF where the R-Sport was less per month than the SE and the Jeep Renegade Sport was more expensive than the better spec. Longitude. So don’t dismiss the higher spec. because you think that the higher spec. car will cost a lot more per month because the list price of the car is much more.

The VW Touareg R-Line is £377.45 + VAT per month and the R-Line Plus is just £3 + VAT per month more at £380.54 + VAT and yet the spec. is much improved. Contract hire is a product that often defies logic – speak to me! By Graham Hill

Following on from my note explaining that Mayor Khan is trying to reduce the number of diesels driving into central London, the London Assembly is calling on Mayor Khan to do more about the daily gridlock. It is suggesting that they need to replace the daily congestion charge with a road pricing scheme.

It currently costs £11.50 per day to drive around the congestion zone area which would be replaced by charges relating to the amount of time spent in the restricted area. Subject to consultations this new scheme could be introduced as soon as 2018.

According to the Assembly traffic delays costs London’s economy £5.5 billion in 2015/16 which represents an increase of 30% compared to 2012/13. Can’t for the life of me see how they arrive at such a figure. The Assembly pointed to a similar scheme operated in Stockholm whereby you pay between £1-£3 each time you cross in or out of a central zone, with the charges increasing at peak times.

The result was a drop in traffic by 22%. The proposal is that they consider a similar scheme but also include an allowance for emissions and adjust the rates accordingly. Before you start writing into Mayor Khan there are discounts and exemptions which the Assembly intends to keep but with no plans to extend further.

If you’re a Londoner I guess you must hope that Mayor Khan doesn’t have another Trump moment and apply the new rules by the end of February! By Graham Hill

What happens to the laws being introduced by the EU after Prime Minister May has started the Brexit process by enacting Article 50? Over the next couple of years, called the transition period, the EU will impose laws on all member countries but where does it leave us as we will still be part of the EU for two years after Article 50 is passed through parliament?

Take the European Court of Justice ruling in the Vnuk case. A Slovakian man was injured when a tractor reversed into a ladder that Mr Vnuk was on. Insurers refused to pay up as the accident happened on private land so it was up to Mr Vnuk to sue the driver privately for his injuries.

His claim went through the courts and failed at eac level until it was referred to the European Court of Justice. The European Court of Justice ruled in 2014 that it was compulsory for all vehicles to have insurance, whether on the road or not, and whether used as a vehicle or machine, which should have therefore protected Mr Vnuk.

The EU’s Motor Insurance Directive states that vehicles such as lawnmowers, disability scooters and golf buggies should all carry insurance, much to the annoyance of our own insurance industry. The Government is, as a result, consulting about changes to the Road Traffic Act in order to meet the EU regulations.

Having expressed concerns regarding the cost of conforming to the EU regulations it would seem that as we are expecting to be outside the EU when the changes have been formalised the lawmakers have introduced a ‘sunset’ clause which means that changes to our current laws, as a result of this directive, can be immediately ditched the minute we Brexit. What a waste of time and money.

The question is how many more regulations will be introduced with ‘sunset’ clauses incorporated into the UK laws before we fully exit the EU? And where do we stand when European workers come into the UK to work on farms and experience similar accidents, will we need regulations to cover UK workers and others to cover EU workers and will UK workers be happy to be refused the same protection as those working in EU countries? And so my concerns about the full implications of Brexit continue. By Graham Hill

There are a great number of misunderstandings when it comes to resolving problems with garages and dealerships. You can avoid the costs of a court case by turning to an Alternative Dispute Resolution company, recommended by the Government as a way to stop courts from getting clogged up.

If you have a dispute with a dealer that you cannot resolve between yourselves you can refer your complaint to an ADR company. In fact the dealer must suggest an ADR company if they are part of a trade body. If they aren’t part of a trade body the dealer must point you in the direction of ADR but they do not have to adhere to the recommendations of the ADR company, which kinda makes the whole process a bit of a nonsense.

If they are part of a trade body the dealer must be signed up to a code of practice against which their performance is judged. I have my reservations regarding this practice, especially as the courts themselves can encourage you to go through a court appointed ADR company in order to avoid taking up court time and the possibility of you carrying the costs if your court case fails.

I just feel that a court appointed ADR service would carry more weight than an independent working with the dealership’s trade body. Time will tell if my reservations were justified. By Graham Hill

One of the great things about new cars is the quietness of them. Improved car design reduces wind resistance and wind noise. Drive a diesel car and you could be mistaken into believing that diesel engines no longer rattle, they do, but because the soundproofing is of such a high standard now, you can hardly hear the engine from inside the car.

Tyre compounds and new suspension systems reduce road noise dramatically and of course hybrids and full electric vehicles are as quiet as a mouse when operating in electric mode. The problem is that many of the changes have come about very quickly so when a driver moves from a 3 year old car to a new car the noise level drops so significantly that he or she loses all perception of speed.

The main indicators such as engine noise, road and wind noise have been all but eliminated in some cars so the fear of many safety experts is that we will see a significant increase in accidents and/or speeding tickets as a result of speeding. Having read about the latest Tesla challenging Faraday Future FF91 capable of developing over 1000 bhp out of its electric engine taking it from 0 – 60 in 2.39 seconds without making a noise, I’m very worried.

Even petrol and diesel engine’d cars pose a threat to safety. So if I or anyone else has convinced you to ditch your 5 year old car for a brand new model make sure that you acclimatise yourself to the noise levels before you start ‘opening her up’ on an A road or motorway. You don’t want to be writing your new car and/or you off in the first few weeks of taking delivery! By Graham Hill

Over the near 30 years that I have been in this industry I have seen and done many things, seen some of the most crooked activities carried out by dealers, brokers and car supermarkets, amongst others, as well as fraudulent attempts to acquire cars by crooked customers.

For many years I was an expert witness for the Crown Prosecution Service in cases of vehicle and asset finance fraud so I’ve seen most things crooked that go on in the automotive industry, some of them revolving around so called pre-registered cars and ex demonstrators.

Whilst I won’t bore you with all the fraudulent things I’ve witnessed, you’ll have to buy my upcoming book for that, I’ll share a couple of things with you as I’ve had a couple of potential clients who have recently avoided contract hiring a new car in favour of a so called pre-registered car or an ex demonstrator on HP or PCP.

First of all I should point out that it is possible to get a good deal on an ex demonstrator but it’s the luck of the draw and I’ll explain why. But let’s start with ‘pre-registered’ cars. First of all let’s be quite clear, there is no such thing as a pre-registered car in the way that it is advertised by dealers. Even the head of CAP HPI refers to pre-registered cars when referring to cars that are registered then sold when they include huge discounts. The pre-registering of highly discounted cars is an illegal act made illegal by Stephen Byers when he was Labour Trade Secretary in 2000.

He was concerned that the practice carried out by manufacturers who forced their franchised dealers to buy cars, albeit at heavily discounted prices, was skewing the new car registration figures. So as part of his Supply of New Cars Order 2000 it was made illegal to pre-register cars, here is the excerpt:

This order was made under the monopoly provisions of the Fair Trading Act 1973. It prevents new car suppliers from:

• discriminating on price between dealers and fleet buyers
• providing bonuses and discounts to dealers on pre-registered cars
• imposing on dealers restrictions on price advertising

Now let me be clear, dealers can pre-register cars but not as a result of increased incentives applied by the manufacturer on individual cars. However, some dealers and manufacturers have found a way around this. As an incentive and across the board, a dealer will be set a sales target for the month/quarter/year and he will be paid a Volume Related Bonus (VRB) by the manufacturer if he can achieve the target.

This money is paid retrospectively on all cars sold during the month, quarter or year. As the bonus is not specifically on the ‘pre-registered’ cars they kind of get around the regulations. As an example let’s say the dealer is offered a VRB of £2,000 per car provided he hits his target of 100 cars for the month. With a few days to go he has sold 90 cars and he is aware that if he doesn’t sell the 100 he will lose £200,000 VRB.

So in order to hit his target he pre-registers the 10 cars in the name of the dealership and pays his normal purchase price for the cars – keeps him onside with the Supply of New Car Order. He now factors in the £2,000 per car that he will receive as additional discount then adds in the normal discount that he would include in the deal making the car a cheap car.

I’ve heard of some dealers preregistering cars and selling them through auction just to recover a reasonable proportion of the money spent out rather than have the cars sitting on their forecourt. Whilst the above may sound like pre-registered cars are a great idea there are other, far more shady, methods used to heavily discount cars and sell as new cars even though they have already been registered. Some, not all, car supermarkets have been known to use this method as well as some dealers.

The cars are diverted from where they were intended – daily rental companies, driving schools or insurance company/bodyshop courtesy cars. When supplying cars to these companies the manufacturer uses part of his marketing budget to heavily discount cars that either get them seen on the road more or are driven by potential buyers. In my experience a daily rental company can buy cars at up to 45% off the list price with 20 – 25% being very common.

In order to get around the Supply of New Car Order dealers started to set up their own daily rental companies and bought their ‘pre-registered’ cars through the new operation at huge discounts then sell them on to buyers, having never put them out on hire, with just delivery miles on the clock, on big discounts as ‘pre-registered’. Nothing wrong with that. Of course the extra name in the log book will affect the resale value of the car – but only marginally. But this is where the 3 month rule comes in.

If you have ever bought a pre-reg. car you will sometimes be told that you won’t receive the V5 log book until after 3 months. This is because in order for a daily rental company to qualify for the extra discount they (normally) have to keep the car for a minimum of 3 months or say 5,000 miles, whichever comes first. Now if the manufacturer wants to carry out an audit the dealer needs to be able to show the auditor that he still has the car.

Whilst he may argue that the car is out on hire, so can’t be inspected, he can produce the copy of the V5, supposedly proving that he still has the car, and everyone is happy. Again, whilst this is shady, is this something that a buyer should worry about? There are also some dealers who will keep the cars in stock for 3 months to avoid this situation. But here’s the crunch. Remember that I said these cars were intended for daily rental companies and they are then supposed to be sold as used cars after 3 months?

Well, many years ago I became involved in this process. Before realising exactly what was going on, I had been arranging stocking finance for wholesalers who would arrange to buy batches of brand new cars from daily rental companies and sell on to car supermarkets for a small profit, similar procedure to the operation following the Stephen Byers order.

This allowed the car supermarkets to sell new cars at less than main dealers could buy them for. The daily rental company would order say 100 cars that would be funded by the wholesaler. The cars would be diverted, at the time of delivery, to the wholesaler who would pay the daily rental company £100 per car for their trouble – they never actually saw the cars.

However, as the cars were intended for daily rental I had calls from dealers, and one comes to mind, who would say that the manufacturer had produced a batch of cars using up old stock of parts, for sale to daily rental companies. In this particular case the interior trim was lower grade, items were missing in the car such as cup holders and front fog lights were missing, all part of the standard spec. of the model badge on the back of the car.

In return the dealer knocked off £250 per car. The wholesaler agreed but do you think he explained this to the supermarkets who were selling these cars as brand new but pre-registered cars? Of course not! It would be fine to sell the cars in their sub spec. condition to the daily rental company who were supposed to rent them out.

A customer is hardly likely to refuse a rental car because the interior trim didn’t match the manufacturer’s brochure for the model he was hiring. And of course they were to be sold as used cars at the end of the 3 months or when they had covered 5,000 miles so the buyer would be buying not a new car but a used car as seen.

There is another way that you can achieve a big discount on a ‘pre-registered’ car. When there is a new model coming out or a facelift on the current model the dealers need to make way for the new model and get rid of the old model cars so he practically sells them at cost but they don’t always tell you about the new model.

I’ve also heard of cars turning up at the customer’s house only to find that he has bought or leased an old model car when he thought he was buying the new model. So check the spec. very carefully if you are going to buy a pre-registered car – it may not turn out to be what you thought you were buying. Oh and some of the cheap lease deals are cars as illustrated above so make sure that you check the spec. meticulously.

You sometimes get what you pay for. Moving on to ex-demonstrators. There are two points to be made here. First is the discount. Demonstrators are taken by dealers not just to demonstrate the basic car. They will often have a mass of options fitted, clearly so that they can be demonstrated to potential customers.

So when they tell you that they will knock 8 grand off the list price of the car that’s the list price including the options that may still make this used car, having had multiple drivers, more expensive than the brand new car with the standard spec. which is what you were originally looking for.

Their trick is to compare the cost of the demo with the full list price of the new standard car – but you’d not have paid full list on the new car in the first place. Balance up the desire of the options and the fact that the car is used against a new car without the options and with a discount. Secondly we have perception.

When you call into a dealership and take a demonstrator out with a nice salesman beside you, toodling along at 30 mph you believe that this is the way that all ex-demonstrators have been treated. Well, let me correct that perception. Many years ago in industry as general manager in one of the UK’s most successful PLC’s, I had a fleet department report into me, responsible for around 700 vehicles.

With a fleet that size we were signed into the manufacturers’ demonstrator programmes which meant that every day transporters of brand new cars would turn up, with virtually every make of car on board, that we would have on loan for anything up to 3 months, often 2-4 weeks. I would allow our sales and service staff to use these cars. As they weren’t their own company car they would proceed to ‘burn rubber’ out of our depot and treat the cars like rallycross cars till they were returned.

As we didn’t own the cars I wasn’t worried but at that point I thought to myself I will never ever buy an ex demonstrator as I know how many of them are treated. Oh and often dealer sales staff get to use the demonstrators for personal use and I’ve seen the way they drive them away from the dealership so I strongly recommend that you give ex-demonstrators a very wide berth or you may end up spending more time waiting for repairs to be carried out than actually driving the car! By Graham Hill

One of the things I’ve never quite understood is the way that so many industries, the motor industry in particular, avoid like the plague the rights of consumers. If the rules are considered to be unfair on the providers then the industry should fight to have them changed.

Take for example personal contract purchases (PCP). Dealers try to con customers into coming out of the agreement early in order to put them into another new car. They will tell the customer that they are simply taking their old car back and allowing them to go again with a brand new car.

Nothing wrong with that you might think but they are exercising, on behalf of the customer, what is known as Voluntary Termination (VT), sections 99 & 100 of the Consumer Credit Act. This allows a customer to simply hand back anything (cars, TV’s, lounge suites, computers etc.) he has on HP or Conditional Sale after 50% of the total cost has been fully paid.

Again nothing wrong with that, it’s your legal right. However, few dealers actually explain the process properly and forget to mention that whilst exercising a VT shouldn’t affect your credit score it is noted on your credit file and could affect your ability to obtain finance in the future. Miss-selling? Only time will tell when the claims companies move into the PCP arena.

Now that process exercised by car dealers, as it seems to have a somewhat minor affect on the leasing companies that provide PCP, has become an acceptable practice as it would seem very few people exercise the VT right in order to obtain a car a little early anyway.

However, when I suggest that people who are locked into a PCP, should use VT to terminate their agreement early in order to avoid a service and MOT that is usually due just as the car is due for return at the end of a 3 year agreement, you’d think I’d turned into Satan himself! Even worse when I go on to use VT to avoid excess mileage charges.

Let’s say you have been conned by a salesman to take out an agreement based on 5,000 miles per annum, without him asking what your actual mileage is likely to be, and find that you have actually overshot the mileage allowance by 20,000 miles. It is common to find that you will be facing an end of agreement excess mileage cost of £2,000.

So I suggest that the driver VT the car to avoid the excess mileage charge because if you return the car under the VT rules there is no reference to mileage so in theory you could be 100,000 miles over the mileage allowance but as there is no mileage restriction on the VT of a PCP, as long as the car is in reasonable condition you can VT the car.

Finance companies will try to charge the excess mileage on a pro-rata basis but here’s the thing, they are abusing the law. They know that they can’t charge the excess mileage but they do it in order to frighten the driver with a court case. And that shouldn’t be allowed to happen. The lender knows the rules perfectly well but they are allowed to frighten customers into parting with cash – it’s not right! By Graham Hill