Car imports booming
Tuesday, July 09, 2019
Ireland’s car import boom stepped up a gear while new car registrations slowed in the first half of 2019, thanks to the Euro’s consistent strength against the Pound.
That’s the finding of new analysis released by the foreign exchange specialist Fexco Corporate Payments.
Fexco’s data reveals that during the first six months of the year, Irish motorists increased their spending on vehicles imported from the UK by 107% compared to the first half of 2018.
The analysis of more than 4,200 transactions, made through Fexco Corporate Payments, also found the number of UK vehicles imported by Irish drivers rose by 74% on 2018 levels, and that the average amount each buyer spent rose by a fifth to €17,709. That’s €7,708 (77%) more than they spent on average in the run up to the Brexit referendum, in the first half of 2016.
The data comes as official figures from the SIMI show that new car registrations continue to slow across Ireland. A total of 80,712 new cars were registered during the first six months of 2019, down 7.4% on a year ago.
By contrast the total number of used cars imported during the first half of 2019 rose to 53,120 – up 2.4% on the same time last year – putting Ireland on target to smash the record annual total of 100,755 used cars imported in 2018.
Fexco’s data suggests the import boom is being driven mostly by individual motorists rather than car dealers. It found that Irish car dealers increased their spending on UK imports by a modest 30% between 2018 and 2019, a jump less than a third the size of the 107% surge recorded by motorists.
On this evidence, the Euro’s strength against the Pound is encouraging ever more Irish motorists to import a car directly from the UK, and prompting many to push the boat out and order higher spec models.
During the first half of 2019 the Euro was worth an average of 89.3p, 14.8% more than it was on the eve of the UK’s Brexit referendum in June 2016. At its highest point this year, the Euro reached 91.2p, 17.2% above its pre-referendum level.
David Lamb, head of dealing at Fexco Corporate Payments, explained: “While Ireland’s car dealers were the first to spot the buying opportunities offered by cheaper British imports, the savings are now attracting growing numbers of individual buyers too.
“The UK has a much greater supply of used and nearly new cars than Ireland, so a British used car will typically cost less than a similar model on this side of the Irish Sea.
“When you factor in the added purchasing power the strong Euro gives Irish buyers looking to the UK for their next car, the case for buying British can be compelling.
“Nevertheless, when buying a high-value item from the UK, exchange rates can be a dealmaker or a deal breaker. That’s why we’re seeing increasing numbers of astute buyers – both private and professional – opting to lock in the current favourable exchange rate by using a forward contract.”