The Motoring Industry & The Recession

[Dotsy]

Was it under 12000 miles or six months? They're the only criteria that need to be met, AFAIK, aside from being in personal (as opposed to business) ownership throughout.

It was an Oct 2007 registration and had 22,000 miles on it. It had one private owner.

[dublinred]

Very difficult, and in a way unfair, to compare Irish and English used car prices. In England, once a car is sold to a private party, there's never any VAT on the car again. In Ireland, there's VAT charged every time it's traded in and re-sold. So, for example, take a E25k car in Ireland and England. After one year, it's valued at E18k nett of VAT. The Irish dealer has to sell it for E22k to make his E18k, while the English dealer can sell it for E18k and keep all the money.

I bought a few cars in the Uk and brought them over never had to pay any Vat , did have to pay the VRT eventually which is based on what Irish revenue value the car at in Euros and bears absolutely no relation to the price that you paid for the car maybe this is how they catch up on the vat.

[pineapple stu]

It was an Oct 2007 registration and had 22,000 miles on it. It had one private owner.
Hm. Was going to suggest maybe the export made a difference, but londonred is backing me up. Don't know why they'd charge you VAT rather than take the whole sum, but AFAIK, that's not supposed to happen. Unless the trader had bought it before it was six months old?

[pete]

You do not pay ROI VAT on imported cars more than 6 month sold and more than 6km. Seems from example above UK dealers have to charge VAT on used cars just like dealers here.

[Fr Damo]

I hear main are dealers are getting very worried. The longer people hang onto cars the less likley they are to go back yo a main dealer for the servicing as they will be out of warrenty. The workshops will therefore not be getting main dealer rates for labour and huge margins on OE parts.
The sole trader or family business selling used cars could be one of the growth ares in this recession. Threats V Opportunities.


Or heaven forebid, they brought their hourly rates down! I get me car serviced, (06 1.9 Diesel) by a local family run garage, oil change, filters, screen wash and brake check for 100 maybe 120 euro... 50 for labour about 50 for parts and vat at 13.5% The same routine service in a main dealer would be double that. Remember the days where you booked your car in for the next service when you had just paid for your last anyone?

Saw a link today by Mary Ellen Symon (sic) in that rag the Mail, god she painted an awful bleek picture of the Emerald Isle. (1 letter away from Iceland type rant) It can't be that bad can it?

[pineapple stu]

Seems from example above UK dealers have to charge VAT on used cars just like dealers here.
They don't. The example is an exception. Came up again during the week.

Edit - looking for a link on the aul internet, and used cars in the UK come under the margin scheme (http://www.hmrc.gov.uk/vat/account-margin.htm), which disagrees with dotsy's invoice. Not sure where that's coming from, unless, as I mentioned, the car was under six months when the garage bought it.

[pete]

They don't. The example is an exception. Came up again during the week.

Edit - looking for a link on the aul internet, and used cars in the UK come under the margin scheme (http://www.hmrc.gov.uk/vat/account-margin.htm), which disagrees with dotsy's invoice. Not sure where that's coming from, unless, as I mentioned, the car was under six months when the garage bought it.

Is this was used cars advertised as "non VAT qualifying" in the UK?

Can't Irish dealers just allow the VAT on used car sales against the VAT they pay for other items such as parts?

[pineapple stu]

I've no idea what that post means. :confused:

[pete]

Is this was used cars advertised as "non VAT qualifying" in the UK?


Example: See the 2nd car in this list (http://atsearch.autotrader.co.uk/ni/cars_search.jsp?searchform=&modelexact=1&lid=search_used_cars_full&photo=1&state=none&sort=3&hassearched=Y&make=FORD&min_pr=6000&source=0&model=FOCUS&max_pr=&miles=1500&agerange=6&mileage=2&postcode=bt12+6lr&variant=&bodyid=0&trim=&fuelid=0&colour=&transmissionid=0&keywords=&ukcarsearch_full.x=49&ukcarsearch_full.y=12&ukcarsearch_full=SEARCH)


Can't Irish dealers just allow the VAT on used car sales against the VAT they pay for other items such as parts?

Maybe I am completely wrong. Lets say you sell car & charge say 1k in VAT. You also but other products which you are charged 1k VAT on. Can't the business just balance the two sums off as net 0 value? :confused:

Not picking on BMW but I heard BMW Ireland advertise Irish & UK used cars this morning on the radio.

[pineapple stu]

Maybe I am completely wrong. Lets say you sell car & charge say 1k in VAT. You also but other products which you are charged 1k VAT on. Can't the business just balance the two sums off as net 0 value? :confused:
You can. But it's completely irrelevant. You've just described how a VAT return works.

[Dotsy]

They don't. The example is an exception. Came up again during the week.

Edit - looking for a link on the aul internet, and used cars in the UK come under the margin scheme (http://www.hmrc.gov.uk/vat/account-margin.htm), which disagrees with dotsy's invoice. Not sure where that's coming from, unless, as I mentioned, the car was under six months when the garage bought it.

The car was definitely over six months old when the garage bought it. The previous owner was Ford Contract Hire so I guess it was a trade sale between them and the dealer and that was why VAT was charged.

[pineapple stu]

That'd be it. Not a private owner.

SIMI's stats for January (not sure if they're online yet; don't see them on SIMI's site anyway) note that new car registrations are down 67%. LandRover are down 95%, Porsche 94% (from 18 to 1) and the best performing make is - private imports. Down 17% on last year though. So while some people are importing, it does seem most are too lazy to.

[Dotsy]

When I was checking my car onto the ferry the customs guy told me that half the cars he sees lately are people bringing cars they have bought in the UK back to Ireland. I guess it has picked up in the last month or so with the fall in Sterling.

[pineapple stu]

Could be used cars as well actually. Figures I was given were for new cars only.

[Fr Damo]

http://www.rte.ie/business/2009/0126/cartel.html

Why is this chap getting a criminal record and Seanie Fitz is getting off?

Does anyone know how car sales are performing in England against this time last year? I wonder are the German and French marques under the kosh due to sterlings weakness? i.e it becomes expensive to sell in euro into the uk.

[pete]

http://www.rte.ie/business/2009/0126/cartel.html
Why is this chap getting a criminal record and Seanie Fitz is getting off?


I think thats an old case (possibly posted above in this thread) as there was a load of Citroen dealers at price fixing. The fine is pitiful but it would be no different if they were fixing the price of bread.



Does anyone know how car sales are performing in England against this time last year? I wonder are the German and French marques under the kosh due to sterlings weakness? i.e it becomes expensive to sell in euro into the uk.

A lot of those cars (maybe not the Germans) could be made in the UK? Peugeot used to be in Coventry, not sure if still there...

Reading elsewhere that many manufacturers/distributors starting to slash the price of new cars.

[dahamsta]

Import carmakers leasing acres of coast to store unwanted vehicles (http://www.autoblog.com/2008/12/08/import-carmakers-leasing-acres-of-coast-to-store-unwanted-vehicl/)
Where Are Automakers Stashing Unsold Cars? (http://jalopnik.com/5135675/where-are-automakers-stashing-unsold-cars)
Nissan uses test track as parking lot for unsold cars (http://www.autoblog.com/2009/01/20/nissan-uses-test-track-as-parking-lot-for-unsold-cars/)
Growing stocks of unsold cars around the world (http://www.guardian.co.uk/business/gallery/2009/jan/16/unsold-cars?picture=341883529)

http://static.guim.co.uk/Guardian/business/gallery/2009/jan/16/automotive/xnissan-6163.jpg

[pete]

Crazy photo. Wouldn't want to leave your house keys in one of those :D

[pineapple stu]

British Government absolutely not issuing a bail out to the motor industry in an announcement at 3pm, according to Sky News at the moment.

[the 12 th man]

Just an aside,heard a guy from SIMI reckons new regs for 09 in Jan going to be @ 30% of 08.

Average age of cars in Ireland is about 6.5 years just below UK at avg 6 years,who would have thought the German average is 8.5 years old.

I've only seen three 09's and the month nearly over.

[Fr Damo]

30% of business enjoyed last year (Jan) and at reduced margins plus some losses on second hand car stock? That equals closures.

I posted previously we'd do 60,000 nationally new cars this year. I stand by it. Some idot from the car industry said on Saturday that they are hopeful of 100,000 with a pick up in the latter half of the year. a pick up in the latter half of the year in any year has never happened due to our reg system. When people throw out this bull it just gets on my tits. ISME are the same ( Don't know how Mr Fielding became their voice ) and the clowns who are in real estate always throw out "hopefully" and "Interest Rates Reduction" in the same sentence blissfully unaware that were f***ed. It pains me to say it but.....

[dahamsta]

I've seen just 2 09 cars. The first was a Massey. The second was a manky hatchback just 2 days ago, with a reg under 1500.

adam

[pineapple stu]

with a reg under 1500.
C reg I assume?

[dahamsta]

Yeah. I remember registrations in the tens of thousands in previous years, usually far earlier.

[Fr Damo]

Taken from rte.ie 30th Jan




A management consultant and advisor to the motor industry has warned that if current sales figures continue, up to 300 motor dealerships will close with a loss of up to 20,000 jobs over the coming months.
Pearce Flannery of consultancy group Pragmatica warned that the situation in the automotive sector is untenable given the radical drop in the sale of new cars.
'The Irish motor market is currently operating with a 68% decrease in sales and is facing unprecedented competition in the form of used imports. The industry is being decimated and will implode if the current situation continues.'


That is 10 Dells or say 100 builders going wallop and not aword about it other than a bit in Drivetime with John Murray this evening.

After one months travelling around the country but mainly eastern parts I have seen less than ten new jam jars.

[pete]

That is 10 Dells or say 100 builders going wallop and not aword about it other than a bit in Drivetime with John Murray this evening.

After one months travelling around the country but mainly eastern parts I have seen less than ten new jam jars.

When people lose their jobs they don't buy new cars or houses. The only way to get people to buy cars is to get more people working especially in export companies as that brings new money into the country.

The state cannot offer sweet heart deals to every business in trouble.

[osarusan]

The state cannot offer sweet heart deals to every business in trouble.
Absolutely. I think Waterford Wedgwood is an example of the govt. demonstrating this. How the state decides who to bail out is an interesting question though.

[Fr Damo]

I wasn't suggesting the state should do anything, just pointing out that if you consider Limerick was destroyed (some commentors views) by Dells announcement, and the tale of dole Qs getting longer (initally by tradesmen and women losing construction related jobs) paints a truely shocking picture of whare we are.

Exports are the obvious one to get us back, but do you honestly see us growing our exports over the next 5 years?? I don't.

[dahamsta]

Imagine how much more stable Ireland would be if FF and the PDs had supported indigenous business that many years ago, and more. Like they were asked, by people like me.

[pete]

Exports are the obvious one to get us back, but do you honestly see us growing our exports over the next 5 years?? I don't.

Without exports we are recycling the money already inside the country. Exports don't have to be physical. Irish companies competing or selling abroad also need a lot of supporting domestic suppliers.

January 2009 Registrations
Passenger cars down 66% or 31k units
Commercial vehicles down 80% or almost 7k units

[SolitudeRed]

In Galway I've only seen five 09 reg cars and one of them was in a car dealership! Its certainly very noticeable that car sales are way down just by paying attention to the traffic. Is this a return to the good old days of before the 90s when people only bought a new car every ten years!

[the 12 th man]

Didn't think the figures would be this low for Jan 09
Compared to Jan 08 results below


Land Rover -94.1%:eek:
Saab -93.9%
Mercedes -82.1%
BMW -77.4%
Toyota -64%
February is tradionally worse after the rush:rolleyes: for new regs in Jan so god help the figures at the end of this month..



I think new regs overall are not as high as the indicated 30% and someone is bluffing the numbers,it feels more like down 80-90% overall

[pineapple stu]

I think new regs overall are not as high as the indicated 30% and someone is bluffing the numbers,it feels more like down 80-90% overall
09-D-62xx is on the road now. I'd say demo sales are holding the numbers up; there's a higher proportion of new cars than usual still in garages, which is partly why people aren't seeing them about on the road.

[Fr Damo]

Garage friend of mine had two cars cancelled this week becuase of the pension levy, one army lad and a nurse have about had 200 a month taken out of their take home pay and that was the money being used to buy the car. So the government saved 2500k by getting the individual to make a bigger contribution to their pension but lost probably 8k on each car in terms of VRT and VAT!! mmmmmmmmmm

[pineapple stu]

But sure that's only relevant if every public sector employee had been looking to buy a new car.

[Fr Damo]

True but I though it was a valid point he made to me.

The levy will cost employees 800m euro i.e taken out of nett pay, the point I am making is that this money is being taken out of the conomy, at least until the pensions are cashed, as is being missed.

[pineapple stu]

True, but that's not exactly news, in fairness. The Government needs the money to pay off debts, so it's a Catch 22.

Up to 7000 in Dublin, compared to 20000 this day last year.

[pete]

Saw an 09 D Range Rover so someone still has cash to spend.

Have the UK government given a bail out to car manufacturers? I know they introduced scrappage scheme in Germany but because they buy so many domestic cars that will also benefit their car manufacturing industry.

Maybe Irish government will introduce scrappage scheme but can't see what else they would do that would make sense. SIMI protests about foreign imports don't make any sense when their own members are importing in large numbers.

I think I might have seen as many imports (yellow reg & no tax disc?) as 09 reg cars at this stage.

[pineapple stu]

I think I might have seen as many imports (yellow reg & no tax disc?)
Don't think so? :confused: An import would have to be registered and taxed in Ireland on arrival into the country. Green reg and no tax would be an unregistered garage stock car; assume that's not what you're seeing?

[pete]

Don't think so? :confused: An import would have to be registered and taxed in Ireland on arrival into the country. Green reg and no tax would be an unregistered garage stock car; assume that's not what you're seeing?

I think VRT approval can take up to 2 weeks so I guess can't get insurance/tax discs until new plates have been confirmed?

Seen a few yellow plates with no discs on front windows.

:confused:

[pete]

Mercedes Dealership Dodgy practice (http://www.independent.ie/national-news/courts/new-merc-sold-with-used-tyres-and-wheels-court-told-1661634.html)



A NEW Mercedes Benz was fitted with secondhand alloy wheels and used tyres just before it left a leading car sales showroom, a court heard yesterday.

But Mr Ryan, of 150 Howth Road, Clontarf, Dublin, decided he would have them checked out at a tyre centre.

This confirmed the tyres on his day-old Kompressor were secondhand and had completed about 10,000 miles, with about a third of the tyre tread depth worn away.


Must be difficult to regain reputation from incident like that.

[a.a.d]

I'm one of the people who got up off their arse and actually spent some time looking for a deal on a car in Ireland and the Uk, I eventually went to the uk and Brought back a Volvo S80 with a certified 10K on the clock for a the grand total of €15000 including VRT, tax and insurance for the first year.

I think people are mad to look at the main dealerships here and that the majority of them are not helping themselves in any way, For Example My wife is now looking at getting a new car so she brought her 2006 Opel Tigra into an opel Dealership in Dublin, The car WAS valued at €27000 brand new, the price she was quoted for the car a couple of week ago was €9000. Now thanks to that price she decided not to purchase a brand new opel Astra.

You may say that the price of second hand cars has crashed (excuse the pun) in the last couple of years but on this dealerships fourcourt was a lower speced 2005 Tigra with a price tag of €14500.00 and as her one was a 2006 I would expect them to charge more for it in return making a massive profit.

The sooner a couple go out of business the better if you ask me.

[pineapple stu]

I don't think anyone pays the price in the window.

[John83]

I don't think anyone pays the price in the window.
That, and if you're lumbered with a pile of stock you can't shift, you're not going to be offering good money for more stock.

[pete]

I'm one of the people who got up off their arse and actually spent some time looking for a deal on a car in Ireland and the Uk.

BMW Ireland are now importing new BMWs from their parent company BMW UK. A good effort even if they incorrectly claim are selling at UK prices - they add 10% onto the UK list price. Will be interesting to see other distributers/dealers follow that lead.

[Fr Damo]

Does anyone know where BMWs that are sold in the Uk are actually made?

[pineapple stu]

BMWs are made in Germany. (Or at least, they come from Germany; there's a chance they're made by slave third-world labour, but I'm 99% sure it's Germany)

pete - as noted earlier, other dealers are in fact way ahead of BMW Ireland.

Just passed 10000 Dublin regs. Seems to have slowed even further in February.

[endabob1]

Fr Damo
I work in the Motor industry in South Africa & I have some dealings with BMW here, as far as I know some of the production here is for the UK market, might I ask why the question?

Pinaple Stu
There's suprisingly little automotive manufacturing left in Germany, most of it has moved to Hungary or the Czech Republic. Audi for example produce most of their European Cars in Hungary.

[Fr Damo]

I ask the question because wether the vehicle is sold in Ireland or Uk if Stu is correct the cost of that item to BMW is denominated in Euros... So the UK importer must have to pay more sterling to get his BMW, and therefore the price should be going up in the UK. Albeit only with the currency fluctuatiuon and of course if the market was boyant.

I see car sales in the UK are 21% down for Feb based on last year, that's nothing compared to our 60+%.

These type of measures are what seperate us from the rest of the world & point to the fact we are in serios serious trouble. BTW, did anyone hear Biffo say they didn't know tax was so slow for Feb becasue they wait for the returns to calculate it?? Why doesn't he ask twenty companies how they're sales are doing, A bloodly straw pole, and he would see VAT has collapsed. February 09 was my worst month in Business - Non Car but in Automotive trade, we formed 19th July 93.

[pineapple stu]

Fr Damo
I work in the Motor industry in South Africa & I have some dealings with BMW here, as far as I know some of the production here is for the UK market, might I ask why the question?

Pinaple Stu
There's suprisingly little automotive manufacturing left in Germany, most of it has moved to Hungary or the Czech Republic. Audi for example produce most of their European Cars in Hungary.

According to wikipedia (http://en.wikipedia.org/wiki/BMW#Production), BMWs are primarily manufactured in Germany. (Obviously, "production" is often defined loosely to give a desired answer; could be the last stages of production are done in Germany so BMW can say they're made there.)