Grim month for dealers as new buyers hold off
IT has been a grim first month for most dealers by all accounts. The number of buyers and potential purchasers of new cars has been low. It obviously has been a grim month for them as well with increased bills, more charges and property taxes in prospect.
Consumer confidence is critical for car buying and, as of now anyway, it appears to be quite low.
Registrations have been running at about 28pc lower than January 2012, according to sources. A fall on last January was expected because its figures were boosted by a lot of pre-ordering due to VAT changes.
And with a fair bit of pre-registration over the final days of this month, the figures for this January might come out a bit better.
Pre-registrations means registering new cars to boost market share. They are subsequently sold on as one-owner nearly-new motors at a discount.
But they can not disguise the harsh reality.
Most salespeople reckon it has been a much worse start to the year than last. It has certainly been tougher than most in the industry anticipated or forecast.
As such it casts serious doubt over projections of 75,000 new-car registrations for the full year – which in itself would have been 5,000 down on 2012.
Now a number of those close to the current industry trend are saying the figure could dip to 70,000 – and possibly lower.
It is far too early to say one way or the other and it is amazing what can happen to turn things around.
There is a school of thought that the two 'new-car' periods this year (January and July) might have already had the effect of levelling out buying patterns over the year.
However, unless there is a marked pickup in February, the trend will probably have to be seen for what it is, a reflection of consumer negativity after yet another brutal Budget.
And that could put renewed focus on the 'second window' from July when the 132 registration plate starts up.
There is a belief that many potential buyers have put off making the decision to buy – for now – while holding on to the possibility of a July purchase.
It will be interesting to see if and when they return and what it will take to prompt them to do so.
It is early days and the complexion of the buying business could change over the coming months with a bit of good economic news. We live in hope.