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IRISH USED CAR prices have jumped 56% from the outset of the pandemic to the end of 2021, outstripping the rate of inflation in the United States and the United Kingdom over the same period.
At the same time, electric vehicles (EVs) represented a growing share of new registrations last year. Compared with the first half of 2019, when fully electric vehicles accounted for just 2.4% of new car registrations, that figure had quadrupled to 10.5% in the second half of last year.
The figures are contained in the latest DoneDeal quarterly Motor Report for the final three months of 2021.
It reveals the price of second-hand cars has increased by close to 8% from October 2021 to the end of December alone.
By contrast, the rate of inflation observed in the US and the UK markets for used cars was 47% and 33% respectively from the beginning of 2020.
It means that the price gap between new and used cars is tightening in Ireland, leading to the “unprecedented situation” in which some second-hand versions of the same model of car are being listed for more than their new counterpart, DoneDeal said.
A unique set of factors — including Brexit and the impact of the post-2008 recession on new car registrations — are constraining the supply of used cars and helping to buoy prices, the report highlights.
Since Britain’s withdrawal from the European Union in January 2021, second-hand car imports from England, Scotland and Wales have been subject to VAT and a range of new customs formalities.
As a result, used-car imports from Britain have fallen dramatically.
“In 2019, just before the onset of the pandemic and Brexit, we imported 108,000 cars from the UK,” according to the report’s author, economist Dr Tom Gillespie.
“In 2021 the total number of used car imports from the UK was just 47,034, a fall of 56% from 2019 levels.”
It means there is a deficit of used cars is in the region of 125,000 vs normal trading conditions. This “has led to a doubling of the number of imported used cars from Japan, from 3,243 in 2019 to 9,805 in 2021″, according to Gillespie.
The obsolescence of older vehicles is also contributing factor.
After an uptick in new car sales in the latter part of the boom years between 2005 and 2007, new car registrations dipped in the aftermath of the crash, between 2009 and 2015.
So where previously the supply of used cars was “aided by the glut of Celtic Tiger year cars”, Gillespie explained, “this ageing cohort of cars is rapidly becoming obsolete, hitting the lower end of the market hardest”.
All of this means that consumers looking to trade in their old vehicles have stronger bargaining chips as car dealers struggle to maintain their inventory”, he added.
But the other big story of the past two years or so has been “the seemingly unstoppable rise of electric and hybrid vehicles” Gillespie said.
According to the report, in the first half of 2019, just 2.4% of new car registrations were fully electric. In the second half of 2021, that figure has quadrupled to 10.5%.
It’s the same story with hybrids, which accounted for only 9.4% of new vehicles registered in the first half of 2019. That figure had ballooned to 27% in the second half of last year.
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Fair play to the government for creating this, they have done so much for the youth of this country, make it as difficult as possible so you have too emigrate, better mention all the other foundations for pushing a higher vrt and nox on vehicles coming into Ireland
@Michael Mulcahy: The general price of cars in Ireland is ridiculous compared to the UK and much of that is down to VRT which is punitive but baked into the system at this stage and hard to see it going anywhere.
In terms of the inflation we are seeing at the moment – that’s not a government issue, its a global phenomenon caused by a mixture of 10 years of accommodative monetary policy and pandemic induced shutdowns followed by rapid reopening and accumulated savings.
The fact that the UK, the US and most of Europe are experiencing near record inflation at the same time should indicate that its not a result of domestic policy.
@Lee King Buckett: I hear what your saying, but u have to look at the costs of cheaper vehicles in the UK being illegally taxed when u import them adding on 30% onto the value encouraging the market to pump up prices, there’s an influx of second hand cars in the UK cause of this which in turn brings down the price in the uk
@Michael Mulcahy: Why is it an illegal tax?
@Ciarán O’ Donoghue: Criticisms. Critics of VRT claim that it is effectively a continuation of the excise duty (which was applicable to vehicles in Ireland prior to 1992) and as such is illegal under European union law.
@David Corrigan: Indeed they do claim that and indeed they are incorrect in their claims.
It is a disproportionate tax that really is duty by another name and I’d love to see it abolished but, unfortunately, it’s not illegal.
@David Corrigan: it was, but now since Brexit it’s fair game to place tariffs on imported cars (from the UK at least where the vast majority come from)
@Lee King Buckett: Also due to the fact we need right hand drive cars. Majority of the world have left hand drive cars. If we were the same, we could import cars from many more countries. That would mean an endless supply of cars. UK leaving the EU has pushed this over the edge.
@Michael Mulcahy:
Exactly, well done to the government.
It’s important to know that VRT was just a renaming of the old import duty on vehicles to get around common market rules.
We now have a situation (since Brexit) where Irish buyers still have to pay the VRT and a new import duty as well.
There has always been a level of state protectionism for the Irish car business, but this is ridiculous
@John Black: VRT was never illegal.
@Alan Kenny – Brexit hasn’t helped but the main cause of 2nd hand inflation is the lack of semi conductors for the New Car industry. Waiting times for new vehicles are huge so owners are having to keep their existing cars for longer than normal thus reducing the supply of 2nd hand cars available.
The UK is suffering a similar increase in used car prices as is the US and most European markets.
@Lee King Buckett:
Do you not agree that VRT was just an underhand way of continuing the taxation of car imports in what should have been a duty free market?
It’s like when the government said that prsi, the income levy and the social charge weren’t income taxes.
Let’s be honest with each other
@White Chapel: I agree fully that it flies totally in the face of what the EU was set up for in the first place (the free movement of goods and services without tarrifs) I also agree fully that it is a high tax that is indiscriminate and adds no value.
I am not a fan of VRT at all, nor am I defending it. I am just pointing out that it is not illegal and to say it is is simply incorrect.
The EU granted a specific derogation to Ireland as part of one of the Accession Treaties which allowed the state to retain it within the bounds of EU law.
Sadly, that’s just the legal fact.
@Lee King Buckett: Much of Irelands inflation is being driven by carbon tax, the set excise duty on fuels and the fact that automotive fuels are taxed at the luxury rate of 23.5% VAT even though this may be a worldwide phenomenon the govt here could do a lot to alleviate it. They take a criminal 1 euro out of litre of petrol and diesel at the moment which adds price onto transport costs, food production, building materials, retail costs and on and on and on. If Éamonn Ryan wants people to change to greener forms of transport, heating, homes etc then instead of fleecing people with what’s been overwhelmingly proven to be a negative measure like carbon tax they need to incentivise to change. There is not too many families in this country that can afford a 50 grand electric family car and also the downright hypocrisy of having to pay a pso levy and carbon tax on electricity from wind farms. It proves to me that this carbon tax is all about revenue, virtue signalling and nothing to do with a genuine attempt to reduce carbon
@Michael McGrath: It is wholly incorrect to state that much of our inflation is driven by carbon tax.
10%import duty followed by 23% VAT followed by crazy VRT charges has made cars on our little island about twice the price of our neighbours across the water . We then have to contend ourselfs with 3rd world road surface conditions on 90% of the countries roads.
@Jerry Slattery: A few years ago, a friend came home from England on the ferry. He had a Skoda Fabia 1.4 diesel. Total tax for the year was £30. When he looked at the tax disc on my top of the range 10 year old 1.9 diesel golf and saw €600. He nearly had a heart attack.
@Jerry Slattery: The new car motor trade have the ear of the Minister and the revenue gathering properties of new cars as well as the profits to the trade brought about all these changes.
Completely closing down the only newer and also CLEANER used car market – UK is the most contradicting thing the gov could possibly do regarding their climate change agenda.
Since now half of ireland is stuck with an old diesel cars that doesn’t meet euro6 standards the slightest being unable to renew them and unable to buy an electric washing machine.
Lose – Lose scenario.
@John Johnes:
Usually Irish gov policies.
It’s almost dystopian at times
@John Johnes: government didnt do that. EU trading rules apply since the UK left.
@Paul Clancy: really? Did EU trading rules applied on VRT??
@billy bound:
Imagine the current situation:
government is blaming emissions on the cars – which most of them are 10+ years in the country(euro4/5a), which engines do not meet euro6 standards at all to produce far less emissions.
At the same time – government completely removes their people opportunity to afford to renew their old cars with the newer(euro6) much cleaner ones from across the road.
so the only opportunity that is left for an Irish is to drive an old car , so the government is increasing tax on everything in the country under the slogan “change” , “climate change” , “high emissions” and etc. And demanding to buy an electric ones that cost more than a mortgage deposit.
Mind-blowing
@John Johnes: sounds like my life.
Buy a 30 year old car. 50 euros tax a year. 200 to import it. Who does this benefit?
Bad for environment but I’m not making up the rules.
@billy bound: You have to pay vat and import duties if coming from the UK
@billy bound: Cars of that age are great for weekend use etc, but they are way too unsafe if crashed, and no way I would drive one everyday with family on board
@billy bound: also from what I understand there is usually a mileage limit placed by the insurance company and you need to have insurance already on a regular car before insuring a vintage one. I could be corrected there though, not having a vintage one myself.
@Tim Clifford: The millage limit is negotiable with some companies by paying a bit more. but it is near impossible to get just classic insurance without a main car, but you can sometimes insure them as just a car with the old insurance company that still accepts older cars. I got lucky, my car is insured as a classic and only car as i’ve had the policy for years across a few cars.
Genuine question from an id1ot …does that mean when I trade in I get the same price as a new car? I wonder if the trade in values have risen much?
@Thomas Meaney: You’re much better off selling yours privately and then going to buy a new car without a trade in.
@Thomas Meaney: no still dealing with car dealers. They may be trying to sell a 6 month old car for the new price. They will offer you less to cover profit overheads etc.
Single market made a big difference or did it
Vrt for the Irish
We are whipped by our own government on this. Why oh why do we hate each other so much? End VRT.
@thesaltyurchin:
Brain washing?
@billy bound: that’ll be €50 thank you
Not just vrt anymore. Try importing a not that old car into Ireland from the north. Nox charges can be horrendous.
And duty , vat on non ni cars
@billy bound: Nox charges are reasonable on petrol cars and actually capped at €600
Nox on diesel cars can be as high as €5,000 but that was the idea behind it – to reduce the number of diesel cars imported. Just bring in a petrol car instead.
@Lee King Buckett:
Yeah right, simple as that and get 35 mpg. Diesel 50 plus.
@Lee King Buckett:
Its only an ‘extra’ 600 on top of the vrt. !
Shouldn’t even be a charge.
My diesel that is very cheap on road tax costs another 3.5k nox charge if importing now. And then 3k for vrt. And its only 6 year old.
Crazy amounts.
@billy bound: is it cheaper now to source a car from NI than from Britain or are the charges the same?
@billy bound: Petrol hybrids will give you better MPG than diesel and avoid high Nox charges.
Ditch the diesel addiction!
@Lee King Buckett: exactly I bought a new Hyundai Tucson hybrid I get 800km on full tank which is 44 litres … I got 800km on a diesel Yaris full tank was 40 litres so even with the massive size difference hybrids are great
@David Lynch: cheaper from NI. Anything from Britain has VAT on top.
@Lee King Buckett:
It’s like VRT is a good thing for efs sake by some comments on here.
@billy bound: Hard to argue that VRT is a good thing to be honest – it’s a significant indiscriminate tax that adds no value.
The Nox charge is pretty much avoiadable by switching to petrol/hybrid without any discernable loss in performance or running costs.
@Lee King Buckett: i see that you have a lack of knowledge about cars Lee.
hybrid/petrol only shows good mpg around town – where you are not exceeding 0 – 30-50 km/h where electrical motor is doing most of the work.
People that commute high mileage to work on a motorway will see x2 worse mpg since they will be burning only petrol.
@Gerrard: Happy for you that you can afford it but I seriously doubt your getting 50mpg on a big heavy car like a tuscon in petrol and were only getting the same in a diesel yaris. I’m getting 55mpg on a 2 litre seat Exeo which is ten years old and a far bigger engine and heavier car than a 1.4 diesel yaris
@John Johnes: I drive a hybrid petrol myself and have done for a number of years. I can categorically state that they are capable of better MPG than diesels.
You draw attention to your own lack of knowledge when you incorrectly allege that hybrids only offer efficiency in town traffic. The electric motors constantly kick in to aid acceleration and when you are driving inclines – all of this reduces fuel consumption dramatically.
To give an example off the top of my head, the 1.8l hybrid Toyota Chr returns 74mpg.
Have you anything else to add there sir?
@Michael McGrath: Hi Michael – he mentioned that the Tuscon is a hybrid so the range is entirely plausible.
@Lee King Buckett: No offence but my mother in law has a TOTR 1.7 Toyota CHR Hybrid and it does nothing remotely like 74mpg possibly little over half that and the electric motor does not kick in on long journeys. Absolutely brilliant town car but not motorway driving
@Michael McGrath: There isn’t a 1.7l Chr hybrid. They only came in 1.8 or 2.0l options.
Absolutely the electric motor assist kicks in under acceleration and inclines. It’s the same technology as the Prius and the lexus range.
@Lee King Buckett: i am basing my statements from the car experts. Open up google and take a look what is more efficient on a motor way – diesel or hybrid/petrol. 90% of all the info from the car experts and magazines will tell you its Diesel.
@Michael McGrath: what would I have to lie for it’s a 1.6 petrol hybrid see you have a 2.0 there is your problem … I do a mix of motorway and town driving and electric motor always kicks in on motorway too …obviously if your doing very long motorway miles diesel is better but killcullen to Dublin has only about 20k of motorway some national roads and then city … hybrids are brilliant even auto trader shows the new Tucson hybrid at 49mpg
@Gerrard: i am surprised you are not getting a 100mpg Ger.
a quick review search on google about 2022 hybrid tucson mpg gives 32mpg at best driving like a grandma.
@John Johnes: They are 48-50mpg everywhere unless of course you happen to be looking at US articles (they use a different measurement for gallon…)
@John Johnes: go onto auto trader uk and put in premium Hyundai Tucson hybrid and scroll down to running costs and it will show you a combined economy of 49.6mpg and that’s doing all speeds it’s 230bhp also and still brilliant on petrol … that google search could be giving you USA mpg as there gallon smaller … I have the car so I know what it gets and I don’t take it handy in it
@John Johnes: hybrid Tucson runs on EV Mode even going 120kph take a test drive Mr know it all
@Lee King Buckett: Lee , Parkers.co.uk tucson 2022 owner review cite : “After 3000 miles I am averaging 32/33 mpg, which I feel is awful for what is described as a “mild” Hybrid. My Honda 1.6 diesel averaged 42 mpg.”
Official advertised figures are nowhere near the actual real world mpg.
@Gerrard: just looked up the review on carzone UK and exact quote ” does anything from 35 to 48mpg and anyone that used to drive a hyundai diesel that easily does 50mpg would be sorely disappointed”
@Michael McGrath: I own one and I can tell you it gets 5.6 litres per 100k and I have done 30000 kilometres in the last year .. so that’s the facts not hear say
@Gerrard:
You won’t get that mpg though. Check out the honest John website and the real mpg section. My car says 54 average but in reality it is 39
@billy bound: I’m telling you what I get because I’m driving one everyday do you not understand I get 50mpg on my hybrid Tucson how more clearer can I get … I always get 5.6 litres per 100km and I do a mix of driving
Everybody should get an Eamon Ryan clone to act as a mule for transport
Most insurance companies won’t insure 2005 cars if its your first insurance with them .
Sounds like my life
I bought a 9 year old car in november for about 20% of a similar model new. Could not afford a new one so used is the only option.
It’s just the Jap stuff that has gone up!
@Jonathan: pretty much everything has. In fairness the jap performance classics of the 90s have rocketed as a result of US importation eligibility and more cash in the economy – R34 prices are eye watering, Supras, FDs, Chasers, AE86′s etc are really strong money but I think are likely to come down in the future when the economy inevitably contracts a bit.
@Lee King Buckett: that stuff was as cheap as chips during the recession.
@Jonathan: tell me about it – I still see photos of old buy & sell ads from time to time – would make you weep!
@Jonathan: i remember a nice r34gtr in a red ish colour years back and it was listed with 30k at a garage in tallaght…no money at the time…
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