Lockdown savings fuel major growth in car sales

AND so the great motoring lockdown liftoff has begun.

ith dealers’ doors open for sales, at last there is a degree of confidence flowing through the motoring world.

Pent-up demand, extra savings, fewer foreign holidays this year – all the ingredients are there for a big summer spend on a new car or an upgrade.

The level of new-car registrations for April – 7,166 in total – is remarkably high in the face of the rigidity of restrictions. By contrast, just 343 new cars were registered in April 2020. In the meantime, digital deals became the norm.

Use of dealer portals to do business on a click-and-deliver/collect basis provided a compelling insight into the survival instincts and abilities of dealers, as well as the intent and needs of buyers.

It will be interesting to see how many motorists come out to buy this month. Sales are already well ahead of May 2020, but many are expected to book their car for the new registration period, starting on July 1.

There is a new-found confidence in the car industry, but already there are new problems looming. A big concern for some is the potential lack of supply to meet demand, especially post-July.

Government inconsistency around incentivising electrified cars is worrying some distributors, who are afraid to order for January until they see what the Budget holds for the likes of electric vehicles (EVs) and plug-in hybrid electric vehicles (PHEVs).

From a buyer’s point of view, things are looking up. Anyone with a good car to trade in can command a premium price.

That’s because there is a scarcity of decent used motors on the market. UK imports are drying up due to Brexit taxes. A higher price for your trade-in should mean you spend less on the cost of changing up.

It is a well-known fact that the vitality, or otherwise, of economic activity can be gauged from the level of van registrations.

On that basis, there are solid grounds for optimism that the economy is in resilient shape, with LCV (light commercial vehicle) registrations running 52pc ahead of the corresponding period for 2020.

Brian Cooke, of the Society of the Irish Motor Industry (Simi), says there is a “cautious optimism” among dealers.

“Pent-up demand has been there for some time in any event and people have more savings – so there are grounds for real positivity,” he said. “Hopefully we will see that coming through in the new registration period in July and, we hope, in January.”

He said the timing of the restrictions being lifted was good, as retailers can move stock and prepare for the new-reg-plate period.

Looking further ahead, micro-chip scarcity could restrict supply. With seismic shifts ahead on the road to electrification, this could be a pivotal summer for buyers to switch or wait another while to buy electric. 

Most brands have electrified models in their range. Many are heralding new EV arrivals across a spectrum of power sources.

Opel, for example, just unveiled a hydrogen fuel cell Vivaro-e van.

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