New car sales spike 66% in September

Motor trade calls for cut in VRT ahead of changes to emissions test regime

New car sales rose by 66 per cent in September compared to the same month last year, recording the first month of growth so far this year.

However, total new car registrations for 2020 are still down 25.8 per cent on the same nine-month period last year, according to figures from the Society of the Irish Motor Industry (SIMI).

SIMI’s director general Brian Cooke said the jump in September sales can be attributed to the market catching up from the previous eight months of declining sales. “Year to date, a far more accurate barometer, sees a reduction for the fourth consecutive year leaving new car sales at recessionary levels, merely 50 per cent of what we should be achieving in a normal functioning new car market.”

Total new car sales so far this year are 84,535, compared to 113,945 for the same period last year, while registrations in September totalled 5,685, compared to 3,418 for the same month last year.

A significant factor in the drop in new registrations is the collapse of the hire-drive market. This time last year it accounted for 16 per cent of the new car market, with 18,346 registrations. This has fallen to just 2,863 new cars so far in 2020.

Best sellers

Volkswagen remains the best-selling new car brand, with 10,237 registrations, representing 12.11 per cent of the market. It's followed by Toyota with 9,852, Hyundai with 7,827, Skoda with 7,048 and Ford with 6,614. The best-selling car on the Irish market is the Toyota Corolla, with 3,720 registrations, ahead of the Hyundai Tucson with 2,947 and the VW Tiguan with 2,868.

The only brands to record sales growth so far this year are high-end brands Tesla, Porsche and discount brand Ssangyong.

Tesla has sold 681 new cars so far this year, compared to 80 over the same period last year, while Porsche has increased its Irish sales to 107 this year, from 62 this time last year.

The best-selling premium brand this year remains Audi with 3,472 registrations, ahead of BMW with 2,934 and Mercedes-Benz with 2,824.

Fully electric models now account for 4.3 per cent of new car sales, up from 2.6 per cent this time last year, while hybrid sales continue to grow. Regular hybrids now account for 12.5 per cent of new sales, while plug-in hybrids make up 2.7 per cent. Diesel, however, remains the mainstay of the new car market, with a 43 per cent share, followed by petrol with 37.3 per cent.

Tax fears

Ahead of this month’s budget, SIMI is calling on the Government to reduce Vehicle Registration Tax (VRT), saying would protect the 40,000 people employed in the motor sector, sustain business, stimulate new car sales while helping to decrease emissions from transport and protect Exchequer Revenues.

According to Mr Cooke, January 2021 will see a new taxation system for new cars based on a new stricter emissions testing regime, known as WLTP. He said that as a result of this, any increase in VRT would have dire consequences for the sector, which is already struggling in the context of both Covid-19 and Brexit.

“January 2021 will see a taxation change for our Industry, the biggest change to VRT and Road Tax since 2008. The 2008 change coincided with the recession, causing a collapse in the new and used car market with close to 15,000 jobs lost. With the duel threat arising from Covid-19 and Brexit, we simply cannot have the same destabilisation of the car market again.

“A more burdensome VRT regime will undermine both the new and used car markets, making new cars more expensive, impacting on used car values and slowing our fleet renewal. This will inevitably lead to a fall in employment and undermine viable family businesses. What we need to see in the Budget is a taxation reduction that will support the new car market and which will be environmentally positive. This will protect jobs, businesses, renew our fleet and reduce emissions.”