What the motoring experts predict will happen regarding diesel, imports, prices, electric cars
Distributors reveal what is in store for buyers over the next five years
Today we publish the findings of an extensive Irish Independent Motors survey that reveals what car distributors believe will be key developments for consumers over the coming years.
The distributors - the people who bring in the car brands we buy - have their fingers on the pulse. They know first-hand what's likely to happen over the medium-term and how that will impact on choice and price for buyers.
As such, the survey gained valuable insights into the contexts, thinking and analyses behind factors that are shaping all our motoring decisions.
We asked them:
1. Will people continue to buy imports in huge numbers next year? For the next five years?
2. Will cars get more expensive as emission regulations impact?
3. How soon will electric car sales take off in Ireland? Or will they stay low?
4. Is diesel dead?
The most emphatic responses came on diesel. The vast majority unequivocally it was not dead and still saw a future for it.
Used imports will continue running high, at least until Brexit uncertainty eases, our survey found. But many respondents said the price gaps between imports and home vehicles are narrowing a lot.
Virtually all agreed we badly need a far better infrastructure to lift electric vehicle ownership.
And there were mixed feelings on whether car prices will rise in line with tougher regulations and more accurate (lower) MPG and (higher) emission readings under the new Worldwide Harmonised Light Vehicle Test Procedure (WLTP).
What follows is an edited mix of extensive replies.
Audi Ireland managing director Henning Dohrn said the question of cars getting more expensive as emission regulations impact is a question for the Government. He expects a gradual increase in electric car sales over the next five years and a rise in plug-in hybrids. Diesel is not dead and will continue to be important for customers over the next decade.
Laura Condron, of BMW Group Ireland, said diesel was "far from" being dead.
"Just this week, independent tests (carried out by Emissions Analytics) found some new diesel cars are much less polluting than new petrol cars."
She also felt we are at a point where the technology is here for Irish drivers to switch to electric cars.
International experience shows that a range of incentives (BIK, free tolls) is most effective in getting people to switch.
Louise Murphy, marketing director at Citroën & DS Ireland, said rebalancing of demand towards petrol will continue. Diesel traditionally represented 30pc of natural demand and "we are now seeing customers coming back". But diesel is definitely not dead.
Import levels depend on the currency exchange rate in the short term. Long-term, it will depend on whether there is a hard Brexit. Customers need to look at more than just price when importing.
In the short term the new Worldwide Harmonised Light Vehicle Test Procedure laboratory test to measure fuel consumption and emissions will mean higher CO2 figures. Therefore VRT will increase.
However, the Government will have to take this into consideration and adjust the bands.
"We do not need another reason to dampen demand in the new-car market."
She doesn't see electric car sales taking off over the next five years.
FCA Group: Fiat Chrysler Automobiles managing director Paul Hunt expects a decline in diesel buying but feels the fuel still has a big contribution to make. "Petrol and electric/electric hybrid sales will increase further."
He warned of a significant threat of greater numbers of used imports next year. And "as things stand electric vehicle sales will remain relatively low".
The new WLTP system will mean higher CO2 and will place renewed focus on the cost of options and personalisation equipment on cars. "Vehicle pricing post-WLTP will depend on what changes, if any, are made to the VRT system. No one would like to see consumers negatively impacted by the regulation changes. Therefore I would expect manufacturers to attempt to minimise any price changes."
Ford Ireland chief Ciarán McMahon "definitely" sees a swing towards petrol. "And we'll buy more hybrids and electric vehicles".
He expects imports to continue at current levels at least for the short term. For the next five years? Hard to gauge how the final deal on Brexit will affect currency exchange and whether tariffs will apply.
"Cars are getting more expensive due to emission and other safety/regulatory requirements, but all the time we are reducing our carbon footprint."
And we've some years to go before there will be any take off in EV sales. Infrastructure is the problem.
Diesel is far from dead. Commercial vehicles are nearly all running on diesel engines. They are not all going to disappear in the short term.
Honda's John Saunders: "As long as sterling is weak ,imports may seem attractive to buyers, but beware of many pitfalls."
The future of electric cars is entirely dependent on charging infrastructure and battery technology. As these conditions improve, so will the sales volumes. Diesel is "absolutely not" dead.
A Hyundai spokesperson said the biggest change would be a further move towards SUVs. The level of imports is likely to fall as the uncertainty around Brexit diminishes.
There is a cost involved in making cleaner engines and that will have to find its way into the market. Range is still a key reason people don't buy electric vehicles.
And diesel is "absolutely not" dead. "The launch of the next generation of diesel engines will kill the emissions argument."
Jaguar/Land Rover said there will be a gradual ramp-up of new hybrid and electric alternatives. Diesel will still "undoubtedly" remain the most suitable choice for many higher-mileage drivers.
Small petrol or hybrids may start to make more economic sense for some city-centric motorists.
Even upgrading to a nearly-new vehicle from an older car will inevitably reduce fuel consumption and emissions.
KIA's James Brooks said there's no obvious sign used imports will decline next year. However, as increased sales in 2016/17/18 feed into the used-car supply chain and sterling settles, there will be a reduction in imports. Emission and safety regulations will mean some costs being passed on to consumers.
The bigger question is, will tax policy (currently 40pc of a new car cost) be changed to mitigate costs of these regulatory changes to motorists?
EVs and PHEVs will remain niche in the short term. In the longer term EVs will become more mainstream.
Reports of diesel's death have been greatly exaggerated.
The Government needs to outline a long-term strategy for alternatively fuelled cars and not the current budget-to-budget way. Everyone, from distributors to dealers to consumers need certainty on infrastructure and taxation.
MAZDA'S David Bannon said more consumers will switch into SUVs. There will be a more even mix of petrol and diesel buying, with hybrid gaining traction. Electric cars will also grow but not as quickly as in other European markets. "We see imports similar to this year. After that, it's difficult to predict."
Developing new technology (for cleaner cars) can have cost implications (for buyers) but much will depend on government incentives for low-emission vehicles. "We believe EV sales will still stay low over the next five years."
Diesel is "absolutely not dead" and will have a major role to play over the coming decade and beyond.
MITSUBISHI's Eimear Dillon foresees a swing to petrol in smaller cars, but diesel will remain the choice for midsize and larger SUVs.
"We are noticing that as prices in the UK are starting to rise it is making it less favourable to import. There has been a perception that UK imports are better value but this is no longer the case."
The impact of WLTP and new emissions regulations will not be felt here until 2019, but both will undoubtedly put pressure on retail pricing. She expects a lot more electric vehicle launches over the next five years. The current "stagnant market" demonstrates the need for a change of approach to EVs.
Diesel dead? "Today's range of Euro6 emission diesel cars are a completely different technical offering to the models of yesterday and are the 'cleanest' in history."
NISSAN's chief executive James McCarthy says imports will inevitably remain high if the Government accepts we're a dumping ground for dirty UK diesel engines. And: "Manufacturers are reporting that the challenge to meet evolving engine standards as mandated by the EU will result in more expensive diesel engines in particular." Petrol engines will be less costly due to fewer modifications to meet new standards.
Stock availability will be the biggest growth inhibitor to electric car sales in 2018. The BIK incentive on EVs is "extremely attractive" and on average saves drivers a net €350/month in tax. He predicted at least 200pc EV growth in 2018 and 2019.
He claimed diesel as we know it today is dead. Diesel won't disappear but will become quite niche, mostly in bigger sized engines.
An OPEL spokesperson said imports will continue while there are sterling exchange rate fluctuations. There will be a "gradual" increase in electric vehicles next year. We're still waiting to see the impact of WLTP (the new car efficiency test) on local taxes, as the government may consider a change to VRT in the next year or so.
The demand for SUVs will continue to grow.
"While cars may become more expensive over time, their engines will be cleaner and more efficient, so they will be more cost efficient to run in the long term." The sale of electric cars will stay low but increase gradually year-on-year. The 'at home' infrastructure would still need to improve substantially to enable convenience and adoption.
Diesel is "definitely not" dead.
PEUGEOT's Colin Sheridan says the big changes for next year will be "more petrol, more automatic". But diesel buying will remain strong. In the immediate future, imports will remain prevalent, but there is an improving supply of used Irish cars to meet demand.
The potential cliff-edge of WTO tariffs applied after Brexit could have a huge effect on the level of imports.
Right now we allow EU4 and older (2010 and older) vehicles into the country almost uninhibited. A government-backed scrappage scheme would go a long way to reducing the number of such vehicles on our roads.
As we move to WLTP (2019/2020) there will be changes to our road tax and VRT regimes. There is definite need for discussions for all involved (manufacturers, distributors, consumers, SIMI, Revenue etc) to ensure the transition to the WLTP methodology is seamless.
The growth of electric car sales will be gradual. Diesel is "absolutely not dead".
RENAULT/DACIA: Paddy Magee, country operations manager of Renault Group Ireland, says crossovers now account for a third of sales here. For 2018, new models will continue to drive growing sales. Most analysts don't expect a significant sterling recovery in 2018 so used imports are likely to remain the biggest challenge.
WLTP regulations will make emission limits harder to meet without some degree of electrification so all manufacturers will have hybrid, plug-in hybrid and pure EV increasing their share of sales.
There will be continued concern about diesel's impact on local air quality. In the short term it's important that concerns are balanced by understanding that Euro 6 regulations have a significant impact on reducing particulate and NOx emissions.
Electric vehicle technology has reached a point where significant numbers of customers could realistically make the switch.
Infrastructure remains a huge impediment to uptake. As well as installing new charge points, it must include repair or replacement of all of the growing number of broken ones. It seems likely that petrol and diesel cars will increase in price as more emissions systems are added.
SEAT's Neil Dalton told us: "We believe that the quality of used-car imports are questionable with consumers potentially taking risks. We don't see emission changes having an impact on price. There won't be a take off of EV sales, but there is momentum gathering. Diesel is certainly not dead."
SKODA's Raymond Leddy said: "Imports for next year will be much the same as for 2017. Beyond is impossible to say. Cars could get more expensive as emission regulations impact. The biggest challenge here is pricing optional extras as each option will carry a CO2 value. This could potentially shorten the extras list.
"Electric car growth depends on government taxation and tax breaks. And diesel motors still provide substantial efficiency potential." SSANGYONG's managing director Joe Harris reckons used imports will remain the same as this year. Curbs on emissions could, when in place, lead to an increase in motor tax and car prices. It will also depend on whether it's a diesel, petrol or a more efficient car. There will be an increase in electric car sales in the next couple of years. Not all manufacturers can offer an electric vehicle now but in three years' time, the scenario will change. The biggest investment at the moment is developing an infrastructure for the real use of an electric vehicle.
Diesel? There is still an appetite, especially in the countryside.
A SUBARU spokesperson told us: "Next year, we expect the number of imported cars to increase as the uncertainty about Brexit continues. The next five years are hard to call. Tariffs and sterling will impact on the importation of vehicles."
Cars will probably get a bit more expensive in the short-term. In the short to medium term EV buying will remain low. An adequate national infrastructure, with fast charging points etc, is still not in place. That will take at least another three to five years. In the longer term, electric car sales will improve.
Diesel is not dead, but there is definitely a move away from it. The question is, will the Government move against diesel by increasing taxes or by allowing VAT to be reclaimed on petrol?
A SUZUKI spokeswoman said: "Cars will not get more expensive in the short term. And no, diesel is not dead. Nearly two-thirds of the new-car market is diesel this year."
A spokesman for TOYOTA (and by agreement LEXUS) said there is a continuing decline of diesel. "We're experiencing a huge shift into hybrid for 181 with demand reaching up to 80pc on certain models where there is a hybrid option."
This trend will continue with hybrid, plug-in hybrid and EV taking a larger share of new car sales. Why? He claimed that's because consumers know the residual value of a diesel vehicle will be much less in future than a hybrid.
Diesel vehicles will get more expensive as they can't meet future emission regulations. Is diesel dead? "Yes, and it's not just Lexus saying that: Volvo and BMW have already announced they are not developing new diesel engines. Diesel sales are declining across Europe."
Electric car sales will take off, only if the Government expands their definition of electric to all forms, such as hybrid and plug-in hybrid, in terms of incentives such as 0pc BIK. Otherwise sales will remain low.
A VOLKSWAGEN spokesperson said imports will be a feature next year but could become less appealing post-Brexit. They don't expect a significant impact on price from tighter regulations and higher emissions under the new WLTP system.
"But in many cases adding what might appear to be the more expensive options could, in fact, reduce the emissions on a car. For example, an R-Line kit on some Volkswagen models has the effect of reducing the CO2 emission by improving the aerodynamics."
Measures such as the reduction in BIK on electric vehicles have prompted a significant level of enquiries. They expect e-mobility to ramp up quickly with improvements on range, charging time, infrastructure and wider customer acceptance.
Diesel? Year-to-date 65pc of Irish new car buyers are choosing diesel. "It is the drive system with the lowest CO2 emissions (up to 15pc fewer than petrol-powered engines). So our society still needs diesel for quite a while to meet Europe's ambitious climate objectives."
David Thomas, MD of VOLVO Car Ireland said: "I am concerned about the importation of older pre-Euro5 cars and those that may have been written off in the UK but are imported with no restriction."
The new WLTP method of measuring emissions will increase VRT unless there is an adaptation to reflect the new system. There was no sign of any adaptation in the 2018 budget.
"There was some progress on electric cars in the budget, but I think the initial growth will come from hybrid and plug-in hybrid as the step to pure electric will be too great for many customers today."
The current infrastructure and charging times means that the plug-in hybrid is the best solution for many customers at this stage. Is diesel 'dead'? "Not at all."
*Sincere thanks to all who took part.