Have we just seen the first salvo in new VRT rules

Meister

Was looking at the Lexus website and (IS 220D), and doing the figures with new vrt rules, When I last checked (a few days ago..im sure) the 220d executive was
RRP €48,600ish...Now a whopping €51630 = 5.8% INCREASE. The same with the Sport was €51,500ish now €53,510 = €3.9% INCREASE.

Just to be sure i checked the SIMI price list from their website, October pricelist;

IS 220d Executive 48,630
IS 220d Sport 51,420

Has lexus just fired the first shot in battle between the consumer and dealers of who will get the savings in the new VRT, world we will find ourselves in.

endplate

Email your findings into Gromless's office and any other sudden changes that ppl find. Stop Rip off Ireland taking advantage of the car buyers

Cryos

Meister wrote: »

Was looking at the Lexus website and (IS 220D), and doing the figures with new vrt rules, When I last checked (a few days ago..im sure) the 220d executive was
RRP €48,600ish...Now a whopping €51630 = 5.8% INCREASE. The same with the Sport was €51,500ish now €53,510 = €3.9% INCREASE.

Just to be sure i checked the SIMI price list from their website, October pricelist;

IS 220d Executive 48,630
IS 220d Sport 51,420

Has lexus just fired the first shot in battle between the consumer and dealers of who will get the savings in the new VRT, world we will find ourselves in.

Hang on... wouldnt the cars that have already been imported into the county already of had the vrt paid on it? Shouldnt the diesel go down in price (isnt the current vrt 20% of irish market value) ??

Stephen

VRT rate is based on the date of first registration when sold through a car dealer, not on the date it was imported.

maidhc

The VRT on the IS should go DOWN by about 10%

E92

There are a number of possibilities. Maybe the 2008 model year has an increased spec count, so that would bump up the spec count. Maybe the pre tax price has gone up, and the price of the car has increased in every other EU country recently.

Failing that, Lexus are breaking EU law. It is illegal to set different pre tax prices for different EU member states. If neither of the first 2 possibilities turn out to be true, I'd be complaing to Lexus Ireland, the EU and whoever it is in this state is responsible for ensuring that the EU's block exemption laws are enforced. As I say Lexus are in breach of EU law should they either not increased the spec level or not increased the price of the IS220d in the rest of the EU by the non VRT amount, so ensure that they don't get away with this.

Spit62500

E92 wrote: »

It is illegal to set different pre tax prices for different EU member states.

Can you point me to a document that says that this is the case? All I can find on block exemption is stuff about dealers being allowed to sell different marques from the one showroom and that consumers can have their car serviced by a dealer who sells another marque without warranty implications.

This November 2006 document shows that the EU recognises that pre-tax prices differ between EU countries (with Renault showing the greaters differential).

ec.europa.eu/comm/competition/sectors/motor_vehicles/prices/2006_11_a.pdf

Also, how would they set a baseline given the difference in specification between models of the same car sold in different countries?

I'm not trying to start an argument - just looking for clarity...

E92

Spit62500 wrote: »

Can you point me to a document that says that this is the case? All I can find on block exemption is stuff about dealers being allowed to sell different marques from the one showroom and that consumers can have their car serviced by a dealer who sells another marque without warranty implications.

This November 2006 document shows that the EU recognises that pre-tax prices differ between EU countries (with Renault showing the greaters differential).

ec.europa.eu/comm/competition/sectors/motor_vehicles/prices/2006_11_a.pdf

Also, how would they set a baseline given the difference in specification between models of the same car sold in different countries?

I'm not trying to start an argument - just looking for clarity...

I see what your saying but they're not supposed to be doing it. And the prices as the link you've provided me shows, the pre tax prices are becoming more and more standardised. AFAIK like all EU legislation it takes time, but block exemption has been there since 2003. The other thing to note is how UK prices fell over the period 2003-2005, while at the same time ours rose. This is because of the aforementioned Block Exemption. Even if the still can sell cars at different pre tax prices, Block Exemption has made it possible to order an Irish spec IS in Germany or anywhere else, so all you've got to do is buy the car at the country with the cheapest pre tax price. As I said in another thread, it only takes one make to pass on the full savings and because we're in an open economy, others will be forced to because market forces will take effect. Anyway you asked for a link, so here are 3 for you:

E92 wrote:

And if they do they will be in brach of the EU's Block Exemption rules which are over 4 years old now. Pre tax prices of cars have to be the same everywhere throughout the EU, a few% extra for RHD cars yes, but it must be a very small difference. They have to pass on the saving/increase. If they don't then the price of cars in the UK and indeed the rest of Europe will have to rise/fall by the pre tax difference not being passed on to the Irish consumer. Besides, in the Hypothetical situatuion that the pre tax prices were not standardised in the EU, has anyone ever heard of Economics? You know competition,supply and demand, market forces taking effect?

And more importantly, here is some EU legislation on the topic(its too long to post I feel), but I posted some of it in this thread(see post number 128)

And here's a link with 93 pages about Block Exemption in it

Spit62500

Thanks for the links - very interesting. The problem is though that as pre-tax pricing is not aligned in EU member states (even though its supposed to be) then there's nothing for Irish prices to be aligned to. The other problem is that manufacturers will claim that the costs of distribution are higher here.

This makes depressing reading and shows that we're a long way away from convergence yet...

There is a price difference of almost €3,000 between a Fiat Grande Punto in Ireland where the pre-tax price is €10,707 and Hungary (€7,756) and over €3,400 difference on the price of a Renault Megane (€10,683 and €14,103).

The difference at the upper end of the market can be even more marked with an Audi A8 selling in Ireland last year for €65,000 pre-tax and in Britain for €56,450.

However, anybody buying a cheaper car outside Ireland will quickly find the price difference disappears when they import it into the country, with punitive rates of Vehicle Registration Tax (VRT) of up to 30%.

Car manufacturers have traditionally tailored their prices to take into account the different rates of tax states charge.

http://archives.tcm.ie/irishexaminer/2007/03/07/story27154.asp

If we did converge then we'd be saving a fortune, going by those examples.

JHMEG

Sounds a bit like the way shops put up their prices, then proclaim a sale and drop them again, trying to fool us into thinking we're getting a bargain.

E92

Spit62500 wrote: »

Thanks for the links - very interesting. The problem is though that as pre-tax pricing is not aligned in EU member states (even though its supposed to be) then there's nothing for Irish prices to be aligned to. The other problem is that manufacturers will claim that the costs of distribution are higher here.

This makes depressing reading and shows that we're a long way away from convergence yet...

There is a price difference of almost €3,000 between a Fiat Grande Punto in Ireland where the pre-tax price is €10,707 and Hungary (€7,756) and over €3,400 difference on the price of a Renault Megane (€10,683 and €14,103).

The difference at the upper end of the market can be even more marked with an Audi A8 selling in Ireland last year for €65,000 pre-tax and in Britain for €56,450.

However, anybody buying a cheaper car outside Ireland will quickly find the price difference disappears when they import it into the country, with punitive rates of Vehicle Registration Tax (VRT) of up to 30%.

Car manufacturers have traditionally tailored their prices to take into account the different rates of tax states charge.

http://archives.tcm.ie/irishexaminer/2007/03/07/story27154.asp

If we did converge then we'd be saving a fortune, going by those examples.

Hmmmm, what you've posted makes for very interesting(and disturbing) reading. I remember quite clearly What Car? magazine doing a big supplement about Blovk Exemption and how wonderful it would be for the UK(because UK pre-tax prices were so much higher at the time then our ones) because it would force the car manufacturers to massively reduce prices for UK cars. Anyway thats immaterial, but I thought I would mention it.

What's interesting is that the disparities mentioned in the article, none of the cars imported here are done directly by the manufacturer themselves (though this is changing in the case of Audi and Renault from Jan 08)(AFAIK Fiat don't distribute the cars themselves). The manufacturer has to pay the Importer/distributor and the distributor has to make their own profit. Hence why BMW, Mazda and now VAG and Renault are/will be doing it all themselves because it costs them money and us money having the middlemen. That should help close the gap. This is a result of Block Exemption.

We've already seen some of the benefits of this. BMW reduced the price of the current 3 series compared to the old one and now Irish spec BMWs are exactly the same spec as UK BMW's(bar the fact ours have speedos in km/h of course). Originally they wanted a combined UK/Irish market so if you wanted a BMW of a particular spec, rather than waiting for one for several months as you would have done before, if there was one in stock anywhere in Ireland or the UK you would get that one delivered to the BMW dealer you were going to buy the car from but this great plan was scuppered by the Government's decision to change speed limits to km/h for obvious reasons. I don't know about Mazda but if someone knows what Mazda now do differently to before since they changed over, I'd like to be told. I see that coincidently:rolleyes: new Volkswagens have a hugely improved spec list, even the Polo has airconditioning as standard:eek:! Only 4 years ago the Passat didn't even have aircon, and even last year the Golf GTI still didn't have chilled air.

Of course Toyota/Lexus have no involvement whatsoever with the importation and distribution of their own cars here. Maybe thats why there can be disparities in pretax pricing(not that it excuses it in any event). It is clearly disappointing to see that this crap of different pre tax prices still goes on. The point of Block Exemption was to standardise them and what I've quoted earlier(straight from the EU's own website you'll note) says that I didn't dream it all up either and making up a load of BS:D, but once again laws and reality aren't always the same thing:(.

Spit62500

What you're saying makes sense - I think that mazda revamped their prices when they went direct (mainly reductions) - I've no idea if there was any spec changes. I thought that the manufacturers took back their franchises in order to keep control of sales because block exemption meant that there couldn't be any barriers to, say, MSL dealers selling BMWs from the same showroom. There was a protest by the EU when Peugeot imposed blue corporate colour showrooms on their dealers (or at least incentivised them to build them) but it failed and Peugeot showrooms will never be mistaken for a Toyota showroom anytime soon.

We live in hope!