Almost new pre-reg car - more expensive than new?

Casati

https://www.boards.ie/discussion/comment/117851320#Comment_117851320

It amazing car sales have not plummeted more isn't it? I read that U.S. sales fell 15% in 2020 but are only 8% down on 2019 - despite the fact that prices have risen dramatically. With so many people still working from home & not driving as much, growing adoption of cycling, reduced income for whole industries, I would have expected sales to be dramatically lower

I will buy again when I see value but some of the new prices asked are crazy - maybe other people aren't as price sensitive as I am but when I see massive unexplained increased I tend to be happy with what I have now.

e.g. a Superb Sportline 150bhp hatch in 2019 - rrp then was €36670, three year later its €43660- yes that's a €7000 increase. The VRT rate has remained almost unchanged in the three years (gone up from 17% to 17.25%). The new car also attracts 2.9% PCP rate versus 0% three years ago - adding another €2000 of finance costs making the same car €9000 more expensive to buy new today versus 3 years ago. I haven't shopped with dealers but my guess is less of a discount is available now too. What reason other than 'profit taking' have Skoda for increasing the price of a family car like that so much?

Stallingrad

https://www.boards.ie/discussion/comment/117852875#Comment_117852875

With regard to Skoda and other, materiel costs are playing a significant part in all this too. Steel, plastics, rubber, glass, everything is costing more due to supply and demand issues. Look at what is happening in the building trade due to material costs, 30%+ up year on year.

Not saying it is the only factor, but certainly a big one.

Stallingrad

https://www.boards.ie/discussion/comment/117804229#Comment_117804229

How things have changed. In 2012 I bought a pre reg petrol Passat with zero miles that had been sitting with the dealer for a year. Got nearly €10k off list price.

An Ri rua

https://www.boards.ie/discussion/comment/117883991#Comment_117883991

Give it another 12-18 months and we'll be there again. The world is awash with funny money.

Casati

https://www.boards.ie/discussion/comment/117883983#Comment_117883983

I worked for a car part manufacturer- electrical and pumps, valves etc and no price increases of any significant level were seen in the last two years - i.e. inflation level of 2% was typical but nothing too serious. Wages have not jumped by 30%, nor have the capital cost of the factories etc. Just because we have a temporary shortage of MDF doesn't mean car parts have increased by 30%.

I'm opting out for now and I'm fairly certain in a year from now when supply is flooded we will see value back in the market.

Stallingrad

https://www.boards.ie/discussion/comment/117906221#Comment_117906221

Hot rolled steel, the stuff used to build cars is trading at $1800 per tonne, pre pandemic it was around $500. An average car uses just under a tonne of steel. There's no question that material costs are impacting on car prices, the real question is will car manufacturers pass on the material reductions when they come, which they surely will in a year or two.

I think we all know the answer to that one.

Casati

https://www.boards.ie/discussion/comment/117906648#Comment_117906648

Supply and demand dictates prices, once that tide turns as soon as night follows day the massive profit taking by car manufacturers, distributors and dealers won't last

Darc19

https://www.boards.ie/discussion/comment/117906648#Comment_117906648

Price rises can be hidden.

Rebates to dealers are reduced and if dealers don't have the stock to sell, then the rebates drop further as they are usually based on growth figures.

This in turn means less discount to the consumer as the dealer is not chasing the rebate for end of period sales.

Also, notice how few consumer offers are out there by the manufacturers? Another hidden increase.

So in 2019 you may have had an upgrade package "worth" €4,000 for €995, or things like a free tow bar and o% finance on top of a local dealer discount of 5%-8% if you were buying without a trade-in, all that is gone. But rrp may not have changed. in reality its a 10%+ price increase.

Manufacturers are taking some of the hit too in the hope commodity prices will drop. And prices will drop as the market will start over producing and consumers will hold back purchasing (as the poster here is doing). That will lead to a glut in commodities and prices will plummet. A recent example is lumber prices (wood) - prices spiked to $1500 early summer and are now back at $600 and probably soon heading to the multi year average of $450 https://www.nasdaq.com/market-activity/commodities/lbs

In fact a lot of commodities have come back substantially from the early summer highs that made headlines. Unfortunately the media don't see any value in telling people that those high prices have subsided dramatically.

So if you current car is doing the job for you, let it run for another year

wassie

The No.1 issue is not so much the cost of inputs, but rather the availabity of them. Disruptions to supply chains has lead to productions cuts in turn leading to less new cars available for sale and longer waiting times for customers.

By far and away the semi-conductor shortage is the main culprit. FT reported last week "a cascade of factory closures across Europe, North America and Asia, the shortages are likely to continue well into next year." Typically these are short closures of no more than a few days, but the time to shut down and restart is a significant drain on resources and scheduling.

Covid is also still playing havoc in certain South East Asian regions also. Thailand, the major manufacturer of utilities (think Hilux, Ranger, D-Max, Navara etc) is being hit hard by the Covid Delta wave.