Swappage a good bet for 2015 – but market hurt by 'pre-reg' rush
A SENIOR industry figure is betting on a swappage deal for motorists – in the next Budget.
But he heavily criticised marques who pre-register cars at month's end just to hold market share. The cars are then sold at discount, effectively devaluing motors bought at full price earlier in the month.
He feels swappage failed this year because of the nature and severity of cuts in Michael Noonan's measures.
However, it could be a different story for 2015 – especially as it can be proved that additional sales will add millions to the Exchequer tax take and create jobs.
If he had a "fiver to bet", he'd put it on a swappage deal for 2015.
"It was a good business case. It should have happened. But the whole climate of the Budget – medical cards, reduction of welfare payments for young people – did not fit."
Mr Murphy believes sales will rise by 5,000 (to 80,000) next year – without swappage.
There is some confidence creeping back and finance deals such as Personal Contract Plans (PCPs) are making credit more easily available.
And the mid-year change of number plate (141 from next January to June 30 and 142 from July 1) will have an even bigger impact in 2014, he forecast.
Even though buyers stayed away in the lead-up to, and wake of, this year's July changeover, the total number of registrations in the mid-year 'window' was up on the corresponding period for 2012. That was thanks in no small measure to a bumper July.
"As customers become more familiar with it (mid-year 'new' plate), then I expect it will be positive for the market."
Looking ahead, he said: "We've done our budgets on 80,000 (new car sales), and I think that's feasible. We're in a better place year-to-year. The earlier Budget has given us chance to plan; not like previous years when had to wait until December."
And there will be no '13' on the reg plate.
He reports more of an order bank from dealers than this time last year. "Business sentiment is definitely improving."
However, the relentless level of pre-registrations month after month is "structurally" not right, he warns. "A significant chunk of the market is now pre-reg."
One in five cars 'sold' in October were registered on the last day of the month. They will be sold, ultimately, at a discount.
The industry is looking for a more detailed breakdown of the market, which will isolate how many are pre-reg, rentals etc, Volkswagen Ireland chief Simon Elliott revealed last week.