Sales of new cars up 1.5%

PROVISIONAL FIGURES for new car registrations in 2011 show sales of 89,807, an increase of 1.5 per cent on the previous year.

However, while order banks indicate further growth in registrations this January compared to last year, most firms expect the market to fall to 85,000 by the end of 2012. Some even suggest it might fall below 80,000 if the recession hits consumer spending once more.

While the initial months of 2011 were quite strong, sales fell off in the second half of the year when the Government’s scrappage scheme ended in June.

Toyota remains the best selling marque, with an estimated 13 per cent market share, however Volkswagen has overtaken Ford to take second place.

Ford can take some solace in the fact its Focus is set to remain the best-seller on the Irish market, ahead of the VW Golf and Toyota Avensis.

Diesel remains the favourite fuel for new car buyers, making up 71.3 per cent of sales, followed by 26.5 per cent which are petrol. Electric cars failed to attract the expected public interest in 2011, with sales of less than 10 per cent of what was predicted this time last year.

At the time Nissan predicted it would sell 500 of its Leaf electric models in 2011. The ESB had set a target of 2,000 electric cars on the road by the end of 2011 and 6,000 by the end of 2012.

Of interest to the Government as it discusses the upcoming overhaul of the current emissions-based tax regime is that of the new cars sold last year, over 90 per cent qualified for the two lowest tax brackets.

Looking at the year ahead, Simon Elliott, managing director of Volkswagen Group Ireland, said: “There was a really positive close to 2011 and it was very busy between Christmas and New Year, and the dealers are very busy delivering our order bank which is well ahead for all brands against the same period last year.”

His positive views on initial orders for 2012 are supported by Volvo Ireland’s managing director David Baddeley, who says that orders for the first few days from their dealers are up 30 per cent on this time last year.

“That suggests a strong January,” says Mr Baddeley, “but that’s judging it against the same period last year when the heavy snowfall significantly reduced the number of new cars registered at the very start of 2011.”

Other car firms spoken with by The Irish Timesreferred to growth figures of a similar or higher percentage.

Baddeley predicts new registrations for 2012 will fall to 85,000, but many others in the motor trade are predicting they will drop closer to 80,000.

There are fears that some dealers will struggle after the initial sales surge during the first three months of the year. A consistent problem for dealers remains securing and meeting payments for stock finance, the credit facilities needed to purchase new and used cars for the forecourts.

Over 50 per cent of new car sales traditionally take place during the first quarter, driven largely by the prominence of the year of first registration on the number plate. After the initial annual surge dealers largely rely on used car sales to bolster their business.