Drivers splash out on new cars

Irish drivers are buying new cars at levels not seen since the record year of 2000.

Irish drivers are buying new cars at levels not seen since the record year of 2000.

Figures for the first half of the year put sales up almost 13 per cent on the same six months last year.

To date, over 137,000 new cars have been registered since the start of the year, confirming industry forecasts of between 160,000 and 165,000 new cars sales by the end of the year. With such figures, 2005 would be the best year since 2000, when 230,000 cars were sold.

The latest half-year statistics also show new vans selling at record levels, with almost 29 per cent more light commercials being sold in the first six months of this year than last. New lorry sales are up by 24 per cent.

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High sales are also giving the Government an unforeseen cash boost. As Cyril McHugh, chief executive of SIMI, the industry representative body, explained: "We welcome the very healthy growth in new car sales for the first six months of 2005, but it's necessary to point out the huge contribution motorists have made to the exchequer over the same period."

Motorists who have bought new cars this year have already paid €876 million in VRT and €438million in VAT, he says. "This €1.3 billion makes up about 7 per cent of overall Government revenue - a huge proportion of exchequer returns from a single sector."

Dealers across the State expect 2006 and 2007 to be boom years with SSIA savings accounts maturing. Of €6 billion being released, €1.1 billion is expected to be spent on cars.

As for what people have been buying so far this year, the figures show that Fiat's troubles are far from over. Its sporting arm, Alfa Romeo, sold just 383 cars in the first six months of 2005, while sales of Fiats were 1,800 - down from 3,100 in the same six-month period last year.

Fiat sales manager Kevin Slattery claims that the drop is the result of a deliberate strategy: "Historically, Fiat in Ireland has been involved in car rentals in extremely large volumes - as much as 3,500 cars a year. We have now pulled out of that business in order to protect the residual value of our cars." Now Fiat has no more than 500 cars in the rental business, while Alfa Romeo has close to none.

The Italian company will bring in three all-new models by year's end - the 10-year-old Punto will be replaced by a car that shares its engineering with the next generation Opel Corsa; the Croma, a crossover MPV, due in October; and the Alfa 159, replacing the 156, in time for the New Year.

These new models, along with the doubling of dealer numbers - and growing confidence in the brand - should turn Fiat's fortunes around, says Slattery.

Meanwhile, BMW is riding high with its recently launched 3-Series and strong sales of its new 5-Series. Sales across the range for the first six months of the year stand at over 4,200, giving BMW 3.1 per cent of the total new car market, ahead of its German rivals Audi and Mercedes in the premium sector.

Ford's new Focus had over 1,100 sales in June alone. This confirms it as Ireland's most popular new car so far this year, although Toyota still remains an Irish favourite with the Corolla, Avensis and Yaris all appearing in the top ten chart of 2005.