Belfast Telegraph

Tesla to raise prices of electric cars by 5% in UK after Brexit vote

Tesla Motors is to ramp up the price of its electric cars by 5% in Britain as a result of the collapse in sterling following the Brexit vote.

It is the latest US company to mark up goods after the referendum, with General Motors (GM), Microsoft and Unilever all announcing price increases in recent months.

A Tesla spokesman said: "Due to currency fluctuations, we will be increasing our UK prices by 5% on January 1 2017."

The cost of the Tesla Model S 75 - which is is listed on the company's website for £65,100 - would increase by more than £3,000 to around £68,355.

The pound has failed to sustain gains in recent weeks, and is trading around 1.23 against the US dollar - still 18% lower than its pre-referendum high of 1.50.

Against the euro, sterling has dropped nearly 10% to trade near 1.18.

Other US firms including Vauxhall cars owner GM have acted to offset the drop in the pound.

The company behind Chevrolet and Cadillac said it suffered a 100 million US dollar (£81 million) blow from the slump in sterling in the third quarter, and warned earnings could take a 300 million US dollar (£243 million) hit in the fourth quarter if the pound continues to flag.

GM announced a 2.5% UK mark-up in October in an attempt to compensate for losses.

The same month, Microsoft warned it would hike prices for British businesses in the new year by as much as 22% to "realign close to euro levels" and harmonise prices across the EU.

While consumer products will not be affected by the increase, enterprise software prices will increase by 13%, and cloud prices will jump by as much as 22% for clients paying in pounds.

Perhaps the most controversial hike came from Unilever, which ended in a stand-off with Tesco in October after the supermarket reportedly refused to bow to a 10% wholesale price rise.

Tesco briefly withdrew cupboard staples including Marmite and PG Tips from shelves before Unilever announced that the dispute had been "successfully resolved".

Tesco boss David Lewis later took a swipe at global suppliers, saying price increases should be "justified" and not made in an effort to prop up profits.

"The only thing we would ask of companies that are in that position is they don't ask UK customers to pay inflated prices in order that their reporting currency is maintained. They don't do that for countries outside of the UK," Mr Lewis told reporters in October.