July Boost Little Relief for Irish 2012 Sales Bust

Ireland’s troubled new-vehicle industry saw improvement in July with car sales rising 8.6% to 4,431 units, leaving year-to-date results down 12.4% to 71,065.

The Society of the Irish Motor Industry says that as 13,000 new cars are sold in an average July, this year’s increase for the month needs to be taken into context.

“The market is in line with the SIMI's predictions, and the full-year 2012 forecast of less than 80,000 units remains,” it says in a statement.

Last month’s light-commercial-vehicle deliveries jumped 20.8% to 835 units for a 7-month total down 2.6% to 8,620.

But SIMI Director General Alan Nolan tells reporters the outlook remains shaky, with the number of people buying used cars instead of new ones doubling this year. Two-thirds of customers now are considering a used car, up from about half in 2011.

“Last year there was just over one secondhand car sold per new car; now it's more like two used cars per new car,” Nolan says. “The fact that fewer new cars are being sold also means there will be fewer used vehicles (available) in two and three years' time.”

Nolan says the July sales increase is a sign consumers are taking advantage of strong offers from the industry.

“There is no doubt the current level of sales is being driven by the industry seeking to prolong the selling season, and car buyers are continuing to benefit from this with great value out there at the moment,” he says.

“This modest increase in July, compared to post-scrappage trading in July last year, needs to be put in the context of a market at relatively low levels overall.”

Nolan says current sales levels and the number of special offers underline the industry’s efforts to limit the effects of seasonality.

“Up to 70% of new cars are sold in the first four months of the year, so sales activity for the remainder of the year would be extremely low if the industry did not continue to work at delivering strong value offers to potential buyers to drive further sales, particularly during the summer months.

“The hugely disruptive impact of seasonality is one of the most serious challenges facing the motor industry which is exacerbated in a period of economic downturn.”

Nolan says providing not one but two annual registration periods, January to June and July to December, would address this problem and protect jobs and businesses by spreading sales more evenly over the course of the year.

Irish registration plates identify the year of the vehicle; Nolan says a 2-period system also would benefit those who purchase later in the year by more clearly identifying these cars for valuation purposes.

The fight for segment leadership in Ireland has evolved into a scrap between Toyota and Volkswagen.

VW topped July deliveries with 649 units to Toyota’s 497, but the Japanese auto maker narrowly led year-to-date with 8,953 to VW’s 8,876. Third-place Ford sold 505 units in July for a 7-month total of 7,733.

General Motors’ Opel brand delivered 314 cars during the month for a 7-month total of 4,602 units and sixth place on the sales chart.

The Renault Fluence was Ireland’s best-selling model in July, while the Ford Focus remained at the top of the sales chart year-to-date.

VW is challenging Ford’s longtime dominance of the light-commercial-vehicle segment, with the German auto maker outselling its American rival, 256 units to 143, in July. Ford still held a slight lead after seven months with 1,790 deliveries to VW’s 1,731. Between them, they accounted for 41% of the segment.