Dealers get order books ready for a busy new year

MICHAEL MCALEER

Expectations of increased activity within the motor trade next year are at their highest since 2008, with order books already promising a more buoyant year.

"There has been a definite improvement in consumer sentiment and we have seen a significant increase in orders for 2014, particularly for new models such as the RAV4, Corolla and Auris," says Stephen Tormey, deputy managing director at Toyota Ireland. "We are looking at an improvement over 2013."

"Speaking to the dealer principles in the marketplace, the outlook and the order books seem to be very buoyant. I think there are some solid foundations for the year ahead," said Kevin Murphy, Sales and Operations Director for Motorcheck.ie. "I think we'll bump along the bottom a little, but there are the much-spoken-of green shoots, and I think we should see them gain some traction this year. We'll still have a lot of second-hand imports, purely to allow the second-hand market to function. There's still a scarcity of good used cars on the market."

Several distributors who spoke to The Irish Times in recent weeks have estimated the new car market for next year will rise to 80,000, up 5,000 on the likely total for this year. While that is still some distance from the heady days of the boom, it's expected that, for the first time in three or four years, most of these sales will be directly to customers rather than so-called "pre-registrations".

Pre-registered cars are those registered by a dealer rather than a customer. This is done to meet sales targets and achieve sales incentives. These cars are then sold on to customers at a discount given that they are already owned by the dealer, although most will not have any mileage on them. While it's good news for the customers, it creates a false impression of the real state of the new car market. Three senior industry executives who spoke to The Irish Times estimated that the number of unsold pre-registered cars was in the order of 15 per cent of the market this year.

"Pre-registration is something that all manufacturers do, even those who claim not to like the practice," said Michael Rochford, co-founder of Motorcheck.ie. "I don't see it changing any time soon unless something is done throughout the industry that will stop it."

From a consumer point of view, pre-registrations are often a welcome move as they feed demand for lower-priced “nearly-new” cars into the market. It seems that next year may see a reduction in the number of these “nearly-new” cars on forecourts.