Business Irish

Monday 19 August 2019

New car sales slump as Ireland becomes ‘dumping ground for older cars UK doesn’t want’

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Shawn Pogatchnik

Car shoppers increasingly are opting for cheaper used UK imports rather than showroom vehicles in Ireland, the Society of the Irish Motor Industry warned Thursday as it published figures showing a July slump in sales here.

The latest figures are particularly striking because Ireland’s showrooms typically do strong business in July as customers seek vehicles with the brand-new “2” plates signifying the second half of the year.

But in its monthly SIMI Motor Industry Statistics report, the society says sales of new cars last month totalled 24,685, down 8.4pc from July 2018. Imports of used UK cars simultaneously rose 16pc to 9,384 - representing some 27.5pc of all cars newly registered last month on Irish roads.

“The 192-registration period is generally a period of upturn for new vehicle sales, however July has replicated the first six months of the year and proved a disappointing month for new cars,” said SIMI director general Brian Cooke.

“While Brexit is clearly a factor in this increase, Ireland’s taxation system overburdens new cars, causing motorists either to hang on to their older, smokier cars or look to the UK for an older import. Over the last three years we have imported 150,000 cars that do not meet the latest EU emission standards, which in effect means Ireland has become the dumping ground for older cars the UK doesn’t want,” Mr Cooke said.

He called on the Government in Budget 2020 “to redress the balance by implementing taxation changes that encourage the sale of new cars and to focus any taxation increases on older used imports”.

Ireland’s Vehicle Registration Tax is among the highest in Europe, adding 14pc to 36pc to the market price of a new or imported used car. Vat also is applied to imports if they were purchased overseas less than six months before arrival in Ireland.

While still representing a tiny fraction of the overall car market, sales of new electric vehicles are surging, the report found. So far this year 2,689 have been sold, nearly triple the number sold in the entirety of 2018. Some 735 were purchased in July alone, close to the 912 sold in the whole of 2018.

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