The reading displayed on your vehicle's speedometer will usually be calculated from a wheel speed, or axle sensor. There must always legally be a margin for error here, in order for the manufacturer to ensure that the vehicle is never reading under the vehicles true speed.
This is necessary, as any slight changes to the diameter of the wheel or tyre will cause the calculation to be incorrect. For example, factors like worn tyres, less/more air in the tyres, a different brand of tyre with slightly different dimensions or more load in the car could all have an impact.
The differences in wheel/tyre diameter could be tiny (maybe a few millimetres), but at 30mph your car wheels are rotating 6-7 times every second, so it can quickly make a difference of a few miles per hour. This margin for error is taken into account in how the law is applied, and how manufacturers calibrate their car speedos.
To ensure that they comply with the law and make sure that their speedometers are never showing less than true speed under any foreseeable circumstances, car manufacturers will normally deliberately calibrate their speedos to read ‘high’ by a certain amount.
For more information on how our GPS devices calculate speed, click here.