Steady start to 181 Registration period but Brexit still impacting
Car sales figures for the month of January show that 181 registrations are down -4.8% (37,125) compared to January 2017 (39,003). Light Commercials are currently up 6.3% (6,728) compared to January last year (6,329), while HGV (Heavy Goods Vehicle) registrations are down-11.84% (402) in comparison to January 2017 (456).
The SIMI/DoneDeal Report highlights a number of price decreases in the cost of motoring. The average price of a new car in 2017 was 2% lower than a year earlier, while the cost of motor insurance in December 2017 was 10.9% lower than it was a year earlier. However, the cost of fuel increased with Petrol prices up 4.2% and Diesel prices up 3.6% last year.
The report also showsIreland’s strong economic performance last year but despite high levels of consumer confidence, the Motor Industry faced a significant and uncertain year with monthly declines in new car registrations figures, reflecting the substantial impact of Brexit. Used car imports increased by 29.5% in 2017 aided by the weakness in sterling and this also impacted on new car sales volumes by dampening the residual value of Irish used cars this increasing the cost to change for consumers.
Looking ahead to 2018 economic factors look positive however Brexit related uncertainty looks set to continue.
Jim Power Economist and author of the SIMI/DoneDeal Report said: “In normal circumstances, the positive economic backdrop would be expected to deliver growth of up to 10% in the new car market in 2018. However, the distortionary impact of sterling weakness and the associated surge in used imports from the UK will in all likelihood more than offset the positive economics. For 2018, the used import market is projected to grow by 20% to reach 114,950. New car registrations in 2018 are forecast at 118,220, which would represent a decline of 10% on the 2017 outturn.”
Simon Andreucetti, Strategic Account Director, DoneDeal Motor said: “With a projected year-on-year sales surge of 20% in 2018, the statistics in this report highlight the impact that the used import market is having on the Irish motor landscape. The tax take from used car sales was up 34% last year, and, on DoneDeal, we too have continued to see growth, with over 1.1 million car ads placed on the site in 2017. This represents an increase of 7.5% compared to 2016 and now, just over one in every two motor ads placed on DoneDeal is by a car dealer.”
Alan Nolan Director General SIMI commented: “2017 finished down 10.4% as anticipated and also recorded a shift in the market-share of Diesel cars from 70% to 65%. The same trends have been apparent in January’s new car sales, which have delivered a steady start to the 181registration period but Brexit has continued to impact with new car sales down 4.8% while used car import registrations are up 20% compared to January last year. Diesel continues to be the choice of engine for over half of Irish new car buyers however the noticeable trend towards petrol and hybrid vehicles which started last year has continued in 2018. We expect this pattern of sales mix to continue for the rest of the year. While the number of Electric cars registered in January (104) shows a decline on January 2017 (168), this is a timing issue with supply and later new model delivery dates. The Sector remains confident that EV registrations will increase significantly in 2018.”