UK Personal Car Imports from Belgium Hit 40,000 in 1981
A 1981 scheme offering half-price Fords through personal imports from Belgium exposed a regulatory loophole that reshaped UK car retailing and prompted legal battles over European price gaps.
In 1981, thousands of British motorists crossed the Channel to buy new cars in Belgium at savings of up to 50 per cent, exploiting a regulatory exemption that bypassed official import channels and undercut UK dealers. The scheme, advertised by German company Markant, offered a Ford Granada Ghia at virtually half price and average savings of 25 per cent across its range, with even the in-demand Volkswagen Golf GTI available at a 15 per cent discount.
Markant arranged for clients to buy right-hand-drive cars in Belgium to British specification, import them, pay VAT and Special Car Tax, and register them in Britain under a concession that exempted personally imported vehicles from National Type Approval requirements. The cars carried manufacturers' warranties that British dealers and distributors could not repudiate. The operation was made possible by the relaxation of Exchange Control and the freedoms of movement and exchange within the Common Market following Britain's 1973 entry into what later became the European Union.
Official importers viewed the trade as an attack on their marketing structure. Markant boss Hans Georg Wiesner countered that if importers reduced their UK prices to West German levels, they could put him out of business overnight. The loophole drew rapid attention. Volkswagen estimated that of 837 right-hand-drive cars personally imported in the first third of 1981, only 260 belonged to the armed forces, for whom the exemption was primarily intended.
The Society of Motor Manufacturers and Traders lobbied the Thatcher government to close the loophole without success. British Leyland raised its Belgian prices for right-hand-drive cars, and a Member of the European Parliament complained to the European Commission about Britain's Type Approval regulations. Meanwhile, consumer demand surged. Which? received around 35,000 applications for its how-to-do-it kit, and personal imports accounted for more than 40,000 of the 1.5 million new cars registered in Britain in 1981.
The process was not without pitfalls. One reader, Brian W, crossed the Channel to save £2,300, only to find that specifications varied by country and that the Audi Coupé he had paid a deposit on was missing £700 worth of power steering, rear wiper, electric windows, central locking and seat height adjustment. In Northern Ireland, dealers worried as customers exploited an even easier route: of 107 Mazdas registered there in June 1982, 78 had been bought in Ireland.
Ford lost a legal case over the matter when the European Court of Justice upheld an earlier Commission ruling that the company must lift its ban on right-hand-drive cars being sold in left-hand-drive markets. The bubble was expected to burst as early as 1983, as exchange rates eroded price gaps, particularly sterling falling against the German Deutschmark, and British dealers were forced into a price war. That proved a false alarm: the Belgian franc remained relatively cheap, and the personal import route became easier in July 1985 when a new European law allowed someone else to bring the buyer's car over. Ford returned to court and lost again.
The trade eventually deflated as a weakened pound, a European directive limiting pre-tax price variations between member countries to 12 per cent, and permanent discounting in the UK squeezed the advantage. A revival followed as sterling strengthened through the late 1990s and into the 2000s, but the rise of car financing and Brexit complications have since killed the financial benefits. The episode remains a landmark in the history of cross-border car retailing and European market integration.
