Drop of 43% in Clare car sales

Domestic car sales in Clare are down by over 43% in July compared to the same month last year, the latest figures reveal. The drop in Clare is well above the national average of 35%, but below neighbouring Limerick. Car sales in the county are up overall in the year to date.
The drop in new car sales last month is mainly due to the ending of the Government scrappage scheme which saw discounts of €1,500 initially and then €1,250, off Vehicle Registration Tax on cars 10 years or older.
“The fact the scrappage finished on June 30 would have pushed a lot of people who were going to change their cars forward and we had expected to find that July would fall flat after that,” explained Eddie Rynne, general manager, T Sheils & Co. Ltd, Ennis.
“Taking Ford in Clare, our market share I believe we are running 3% to 4% above the national average so we were punching well above our weight in the year to date. Most people, be it scrappage buyers or ordinary buyers, they felt the earlier they bought in the year, the better value they got in terms of their new car reg. They felt they got to have a new car for longer because once the year turns your car looks a year old even if it is only bought a few months previous,” he continued.
Figures released from the Society of the Irish Motor Industry (SIMI) show that in July 2011, 4,067 new cars were sold in Ireland, a decrease of 2,231 on last year, that’s a fall of 35% on July 2010. In Clare the drop was 43.08% from 130 in July 2010, to 74 last month.
In Galway the drop was 36.59%, while in Limerick the number halved, dropping 47.27% from 220 to 116. However year on year, car sales are up by 12.81% in Clare, one of the highest percentage rises in the country. The introduction of scrappage after it was announced in the December 2009 Budget, was a lifeline for car dealerships. 
“It kickstarted new car sales for us. It made it acceptable to drive a new car again. In 2009 with so many people losing their jobs and shares dropping and everything else dropping, people who could buy a new car didn’t feel comfortable doing it because maybe a neighbor or friend had been let go or was facing some hardship. When scrappage was introduced people with old cars could come in and upgrade and it was deemed acceptable because they were getting a grant to do so from the Government,” Mr Rynne explained.
“We would definitely be in favour of scrappage coming back. When you look at the figures it worked very well, not just for the manufacturers, it kept a lot of people in jobs in the trade because it brought up the number of cars sold and the Government collected a lot of money in VAT. There was reduced VRT on these cars yes, but the Government still made a lot of VRT they would otherwise not have got,” he continued.
Director General of SIMI, Alan Nolan said, “The overall market remains very fragile. The months immediately following the ending of scrappage were always going to be challenging. However, the year to date figures are still quite positive, with new cars up 10%, light commercials up 12% and heavy commercials up 3%, all remaining ahead of last year’s figures at this stage.”
Mr Rynne is optimistic about the future.
“We will see further drops because we had scrappage all the way through last year but where we will be kept busy is that we will have three-month-old hire cars coming back in. They will cater for a lot of new buyers who would be coming in to have a look and will see ’11 reg cars with full warranty but for a few thousand euro less,” he said.
Countrywide, the number of diesel cars sold has increased by 22%, representing 71% of all new cars while silver remains the most popular car colour. Toyota is the top selling car make in the country followed by Volkswagen and Ford.
Ford Focus is the top selling car model in the county, followed by Volkswagen Golf and Toyota Avensis.