Irish Motor Industry

BlackWizard

PaintDoctor wrote: »

I was about to reply to points in your thread, but after reading this, it's clear you've got an agenda.

I'm not following you.

It just appears that many people involved in the motor trade are actually saying they need their jobs to be saved.

That's all..

robtri

BlackWizard wrote: »

I'm not following you.

It just appears that many people involved in the motor trade are actually saying they need their jobs to be saved.

That's all..

and the civil servants are all saying there jobs need to be saved, and the construction workers where harping on about it as well before....
why have you an issue with people wanting to protect the job they have????

Also this is a money earner for the country not a money loser..... it makes sense, that why other countries did it... the UK sis it and it worked fine, and they still in recession when it was implemented....

The scrappage scheme is an incentive for large amounts of cash to be moved around, resulting in more money for the government than outlay....

Gurgle

PaintDoctor wrote: »

Probably for the same reasons the Brits and the US decided it would be a good idea to assist the motor trade.

The Brits and US have a motor manufacturing industry.
We don't.

BlackWizard

robtri wrote: »

and the civil servants are all saying there jobs need to be saved, and the construction workers where harping on about it as well before....
why have you an issue with people wanting to protect the job they have????

Also this is a money earner for the country not a money loser..... it makes sense, that why other countries did it... the UK sis it and it worked fine, and they still in recession when it was implemented....

The scrappage scheme is an incentive for large amounts of cash to be moved around, resulting in more money for the government than outlay....

I have no issue with people wanting to keep their job. I want to keep my own job too and I'm saving as well as I can because next year I might not have a job. Everyone wants to keep their job and I understand that. But for one group of people to say that their job should be saved over some other group needs to have sound economic reasoning other than "I jus wan keep me job". The rest of the country and it's industries are in a sh*t hole too.

As for the rest of your points, just read my post again. An incentive which pushes liquidity into a depressed recessing market where the national budget is in deep deficit and surrounded in debt with promises to take 4bn this year and 4bn next year out of the financial system makes no economical sense what so ever.

R.O.R

Gurgle wrote: »

The Brits and US have a motor manufacturing industry.
We don't.

The Brits have a motor manufacturing industry for the Germans/Americans and the Japenese! There is no British Motor Industry left - just a few guys in sheds knocking toghether fibre glass kits.

TomMc

It made more sense in the UK as many cars are assembled there, like Honda, Toyota, Nissan, Peugeot, Jaguar, Land Rover, MINI, Vauxhall and countless other specialist manufacturers.

Absurdum

robtri wrote: »

The scrappage scheme is an incentive for large amounts of cash to be moved around, resulting in more money for the government than outlay....

Do you really think that people who own 10 year old cars have €15k+ ready to spend on a new car?

There are 930 dealers on carzone, let's say that 750 of them sell brand new cars...if a scrappage scheme got 10,000 new cars sold next year, that is just over 13 new cars per dealer. That's hardly going to keep them where they are at the moment, is it?

BigEejit

Absurdum wrote: »

Do you really think that people who own 10 year old cars have €15k+ ready to spend on a new car?

The scrappage scheme in the UK is running out of money, purely for the reason above.

The gubmint set aside a fund of so many hundred millions for it. The idea was that people would buy higher value cars and so when the £2000 scrappage was taken into account it would be less than the total amount of tax paid on the car so the fund would never get depleted.

What _actually_ happened was people bought the cheapest possible car and the tax paid was always less than £2000 so the fund is actually being depleted by each car sale and the last I head it was down by 2/3. I read one of the Sunday papers saying that the gubmint will have to top it up soon or scrap the scrappage scheme.

http://www.marketingmagazine.co.uk/news/911009/Car-scrappage-scheme-running-money-May-car-sales-fall/

It mentions that the big gains were made by Kia and Hyundai.

R.O.R

BigEejit wrote: »

The scrappage scheme in the UK is running out of money, purely for the reason above.

The gubmint set aside a fund of so many hundred millions for it. The idea was that people would buy higher value cars and so when the £2000 scrappage was taken into account it would be less than the total amount of tax paid on the car so the fund would never get depleted.

What _actually_ happened was people bought the cheapest possible car and the tax paid was always less than £2000 so the fund is actually being depleted by each car sale and the last I head it was down by 2/3. I read one of the Sunday papers saying that the gubmint will have to top it up soon or scrap the scrappage scheme.

http://www.marketingmagazine.co.uk/news/911009/Car-scrappage-scheme-running-money-May-car-sales-fall/

It mentions that the big gains were made by Kia and Hyundai.

Where are you getting these details from? The UK Government only fund £1,000 - the Manufactuer funds the other £1,000. @15% VAT it means the car has to cost at lease £6,600 to break even. A Kia Picanto starts at £6,495 so add metallic paint and it's past break even point.

It's running out of money as it's been more succesful than expected!

BigEejit

R.O.R wrote: »

Where are you getting these details from? The UK Government only fund £1,000 - the Manufactuer funds the other £1,000.

http://www.direct.gov.uk/en/Motoring/BuyingAndSellingAVehicle/AdviceOnBuyingAndSellingAVehicle/DG_177693
I dont know where you got your details but i was always under the impression that it was £2k from the gubmint

@15% VAT it means the car has to cost at lease £6,600 to break even. A Kia Picanto starts at £6,495 so add metallic paint and it's past break even point.

It's running out of money as it's been more succesful than expected!

http://motortorque.askaprice.com/news/auto-0905/which-cautions-car-buyers-over-scrappage.asp
Which? best deals on scrappage

• Kia Picanto. The cheapest scrappage deal in the UK right now remains Kia’s official offer on the entry-level Picanto, which can be yours for just £4,195 (32% off).

• Suzuki Alto. Suzuki’s cheap-as-chips city car is normally priced at £6,795 (1.0 Alto SZ2). Under the scrappage scheme, you can buy it for £4,795 (29% off).

• VW Fox. VW’s city car is basic but with £2,000 off the cheapest Fox 1.2 3dr model, it could be on your drive for just £4,845 (29% off).

• Fiat Panda. Fiat is offering an additional £100 saving on top of the usual £2,000 scrappage incentive, taking the list price of the Fiat Panda 1.1 Active ECO down from £7,095 to £4,995 (30% off).

• Hyundai i10. Hyundai is offering a similar £2,100 deal on the i10 1.2 Classic city car, taking its price down to £4,995 (30% off).


It was advertised over here when it was introduced as being neutral cost to the taxpayer. We (taxpayers) were told that the fund would last because higher value cars would pay more into the fund and keep it topped up.

Absurdum

BigEejit wrote: »

The scrappage scheme in the UK is running out of money, purely for the reason above.

The gubmint set aside a fund of so many hundred millions for it. The idea was that people would buy higher value cars and so when the £2000 scrappage was taken into account it would be less than the total amount of tax paid on the car so the fund would never get depleted.

What _actually_ happened was people bought the cheapest possible car and the tax paid was always less than £2000 so the fund is actually being depleted by each car sale and the last I head it was down by 2/3. I read one of the Sunday papers saying that the gubmint will have to top it up soon or scrap the scrappage scheme.

http://www.marketingmagazine.co.uk/news/911009/Car-scrappage-scheme-running-money-May-car-sales-fall/

It mentions that the big gains were made by Kia and Hyundai.

The point I was making is that I sincerely doubt there are a lot of people around with 10+ year old cars and the cash to buy a new car. If the motor trade is hoping to get people to borrow more money, then they need their heads examined.

galwaytt

BlackWizard wrote: »

The incredible amount of vested interests on this thread will make any economical discussion in this Motors section, a complete joke but highly entertaining

Garbage. You can see my posts, and my viewpoint - but I work in the Construction industry. Where does that leave me, then ?

BigEejit

Absurdum wrote: »

The point I was making is that I sincerely doubt there are a lot of people around with 10+ year old cars and the cash to buy a new car. If the motor trade is hoping to get people to borrow more money, then they need their heads examined.

Yeah, but if the car was under £4500 new with scrappage you would have a lot more people taking up the offer compared to £15k with scrappage.


/edit I should say that where I live (middle class outside London) there are a lot of retired people and in the last 6 months I am seeing a lot of old folks driving VM Fox's and other small cars because they can afford £5k for a new car. I suppose they prefer the peace of mind of having a new car in the garage and that it will likely have no or very low parts costs for some time.

Absurdum

London and the UK scrappage scheme are irrelevant here.

BlackWizard

galwaytt wrote: »

Garbage. You can see my posts, and my viewpoint - but I work in the Construction industry. Where does that leave me, then ?

What are you talking about. I never singled you out as having a vested interest of any kind.

BlackWizard

The car scrappage scheme didn't do great in the US. It's result was not predicted. It caused a sharp decline in sales when it stopped. But since the US economy is stabilising then so are it's domestic industries. The US had in it's 2nd and 3rd quarters positive GDP growth. None of this is comparable to Ireland.

30% increase in car sales for the UK because of the car scrappage scheme. But it's forcing their trade deficit over the 7bn pound mark from 6bn. If the US scheme is to go by, once the UK pull their funding from the UK scheme then we can expect a drop of 37% in car sales. This puts them back at square one and then it requires their economy to pick up after that.

All it does is give money to the motor industry to keep people employed long enough so that it can give more money to other people so that they can buy cars off them. If the UK is not out of a recession by the time their scheme finishes then it will be pointless. Not to mention that the BCC quantitative easing programme is still on going and artificially increasing performance indexes. So the UK economy is not the exact model we should go by.

We need to fix the government budget before we even try to play with economic stimulus packages. Even then we need clear signs that we are coming out of a recession and it's not a double dip as predicted. We need economic stabilisation like that which is now appearing in the US.

robtri

BlackWizard wrote: »

I have no issue with people wanting to keep their job. I want to keep my own job too and I'm saving as well as I can because next year I might not have a job. Everyone wants to keep their job and I understand that. But for one group of people to say that their job should be saved over some other group needs to have sound economic reasoning other than "I jus wan keep me job". The rest of the country and it's industries are in a sh*t hole too.

As for the rest of your points, just read my post again. An incentive which pushes liquidity into a depressed recessing market where the national budget is in deep deficit and surrounded in debt with promises to take 4bn this year and 4bn next year out of the financial system makes no economical sense what so ever.

Can you pont out where any any dealer or garage has said there job should be saved to the expense of another job???????

your point makes no sense, by providing a schem like this the big winner here is the government and our pockets as it will raise some badly needed cash....

BlackWizard

robtri wrote: »

Can you pont out where any any dealer or garage has said there job should be saved to the expense of another job???????

your point makes no sense, by providing a schem like this the big winner here is the government and our pockets as it will raise some badly needed cash....

There are lots of economic stimulus schemes that we can do to get the economy going. We cannot choose them all. Only a minor few. So choosing them minor few needs to make sound economic sense for the entire economy.

I already explained why the scheme isn't a great idea right now. Maybe in the future it might be. But not now.

Edit: I sound so anti car scrappage But in fact once we get our economy+budget showing signs of improving and we need a stimulus package, two of the sectors I would suggest get priority is the motor industry and infrastructure projects.

Also there is still a high possibility that by x-mas next year the IMF/ECB might be in charge and lobbying them for car scrappage will be pretty interesting But other countries around us are showing signs of improving so that wont happen.

galwaytt

robtri wrote: »

....your point makes no sense, by providing a schem like this the big winner here is the government and our pockets as it will raise some badly needed cash....

...even if the net to the Govt throught VAT and VRT was balanced, (i.e. no net gain) - they should still do it, because the activity effect in the actual economy, through wages, PAYE, PRSI, Corporation tax and the avoidance of paying social welfare to the same people generally, means it's still worth doing.

Or, do a variation on 'scrappage' to allow some sort of movement on used cars. Anything is better than nothing, and as well know, nothing is what the govt excels at..............


BlackWizard - I know you didn't single me out, the point I was making is that your sweeping statement about the + comments being from the motor trade, would be akin to your + comments vis-a-vis the construction industry. My point is that I'm probably unique in being in yours, but having a great interest in the other, so all the + comments are not 'loaded'......

BlackWizard

I didn't exactly mean that all the persons for the car scrappage scheme had vested interests. But I guess I wrote otherwise. I meant to say that there seemed to be some vested interests and because this is in a Motors section there might be more vested interests than usual. But that's fine, it's impossible to have a discussion without vested interests even in politics (looks at Fianna Fail and their builder buddies )

Bit off topic. But I hope we are very careful that the cowboys in this country don't come back out to play once they see stimulus money.

Article below talks about the mess that is the Massachusetts stimulus plan.
http://www.boston.com/business/articles/2009/11/11/stimulus_fund_job_benefits_exaggerated_review_finds/?page=1

TomMc

With the exception of the SSIA's (which seems like a different era altogether nowadays) the government, the banks and society at large never really encouraged people to save in the boomtimes, just spend spend spend like there is no tomorrow, even to the point of committing to huge levels of personel debt, where the repayments would eventually be unsustainable.

If you cannot save in a boom how do you expect to be able to spend in a recession. Most don't have the savings to spend, or the disposable income to repay loans, if credit was even available which it is not.

Encouraging people to spend whatever money they have on fast depreciating consumer (foreign) goods for the sake of stimulating the economy (short term) isn't prudent. If people want to spend better that it be on something with long term value, an investment if you like, whether than be on energy efficient home improvements or whatever. Or on services where the vast majority of the outlay and so the benefit remains locally or with indigenous industries.

mickdw

The bacon report is suggesting a 25% reduction in vrt with it being completely phased out in 2 to 3 years with a scheme to 'protect' the high value of vrt in used cars.
I cannot quite figure out how they can protect the value of the current fleet if vrt is being reduced thereby reducing purchase cost of new cars unless they offer up some very complicted system.
Im not so sure that permanent reductions in price is the way to you.
People stop buying if they think they can get it cheaper later. We saw this is 2008.
People would run out buying if they knew that prices were increasing.

galwaytt

TomMc wrote: »

If you cannot save in a boom how do you expect to be able to spend in a recession. Most don't have the savings to spend, or the disposable income to repay loans, if credit was even available which it is not.

true

....... If people want to spend better that it be on something with long term value, an investment if you like, whether than be on energy efficient home improvements or whatever. Or on services where the vast majority of the outlay and so the benefit remains locally or with indigenous industries.

.....well if you can name a 'safe' investment, please do so: it isn't property, it isn't land, it isn't pension's and it isn't stocks, and the consumer can't (either through lack of savings or access to finance) buy the 'green economy' and 'smart economy' products either, because they all carry a premium over standard, or conventional.

TomMc

When the new CO2 based VRT and motor tax system came in, it resulted in everyone taking a big hit, one way or the other. Either when trading in (the cost to change figure) or been forced to keep their existing car with its even lower residuals (greater depreciation) for longer, in effect until such time as the vehicle didn't really owe them very much.

If they reduce VRT or phase it out, which would be welcome, I cannot see how people who bought new in late 2008, 2009, 2010 etc will not get stung a second time around. You can't please everyone no matter what system manifests itself, there are always winners and losers, but as I'd expect it to be a fuel based tax that replaces VRT, 2008/09/10 new car buyers are going to be the ones who lose out. Musical chairs second time around.

smash

For any person who has been made redundant or is in trouble of being made redundant in the motor industry there is a solution and I'm going to be blunt about it...

You're a sales person, you can work anywhere - you don't have to stick to the motor industry, a good salesman should be able to sell anything!

The people in parts - a part is a part, there's hundreds of people that make or stock parts for various products outside the motor industry!

The only person that SHOULD be suffering from this is the dealer principle, unfortunatel the service guys are getting it too because they are trained in a specific industry, although I do know a few people getting by with nixers!

TomMc wrote: »

as I'd expect it to be a fuel based tax that replaces VRT, 2008/09/10 new car buyers are going to be the ones who lose out.

A fuel based tax will hit everyone, not just new car buyers.... the tax will be on the fuel!

TomMc

galwaytt wrote: »

true

.....well if you can name a 'safe' investment, please do so: it isn't property, it isn't land, it isn't pension's and it isn't stocks, and the consumer can't (either through lack of savings or access to finance) buy the 'green economy' and 'smart economy' products either, because they all carry a premium over standard, or conventional.

With interest rates so low, it's looking like good old fashioned savings certs are one of the better investments without risks.

Energy efficient home improvements for those who own their own homes. Especially those houses built decades ago where large mortgages are not a factor. This is money well spent as most of the outlay will not vanish into thin air like is the case with a motor vehicle. Cuts heating costs and adds to the value of the home. Ultimately people should make their money work for them, not squander it on ever depreciating assets, for the sake of keeping up with the neighbours.

TomMc

steve06 wrote: »

A fuel based tax will hit everyone, not just new car buyers.... the tax will be on the fuel!

Yes but the new car buyers of 08/09/10 will ultimately overpay on the purchase price of their vehicles (lose quite a bit more in depreciation over the norm) as opposed to those who hold out, until the market settles down once and for all.

smash

TomMc wrote: »

Yes but the new car buyers of 08/09/10 will ultimately overpay on the purchase price of their vehicles (lose quite a bit more in depreciation over the norm) as opposed to those who hold out, until the market settles down once and for all.

No, if a fuel based tax replaces VRT then new car buyers will get a cheap car and have to pay more to run it. Existing owners will have bought an expensive car, and will now have to pay more to run it!

Mr. Presentable

TomMc wrote: »

The scrappage scheme in Germany made sense as they have a motor industry, we have merely a motor trade. .

Except my colleagues in Germany say it didn't work. People with old cars scrapped replaced them with cheap cars: Hyundais, Toyotas etc. Not German cars.

TomMc

steve06 wrote: »

No, if a fuel based tax replaces VRT then new car buyers will get a cheap car and have to pay more to run it. Existing owners will have bought an expensive car, and will now have to pay more to run it!

So the people who buy the exact same new car last of all, in a later year (will get both a cheaper and newer vehicle) are so have gained the most. The cheaper newer car versus the more expensive older one. Everyone will still pay the same for the fuel to run it.


Just like the recent price reductions people buying their new car in early 2010, will buy it for less than many did in 2009 for the exact same model.

__________

Looking forward a few years .... as the pre-tax prices of cars are partly determined by local taxes, if VRT is reduced or abolished, manufacturers will not supply cars to their distributors at as low a price as they do currently, so once again the motorist will lose out. Unless of course we are still in a depressed market which benefits the motorist most of all. It keeps them on their toes. Supply and demand dictates prices almost as much as taxes.

smash

Cash for clunkers in the states didn't really work out either. There's so many stipulations regarding what you can buy and what you can trade!

smash

TomMc wrote: »

The cheaper newer car versus the more expensive older one. Everyone will still pay the same for the fuel to run it.

Yes, but say a person paid 30k this year for a car. If VRT went, then next year the same car new could be 20k. If the original buyer still had 22k worth of finance on the car and they'd only get 14 on a trade in, then they're screwed.

Don't get me wrong, I'd like to see VRT going and a usage based tax introduced!

TomMc

steve06 wrote: »

Yes, but say a person paid 30k this year for a car. If VRT went, then next year the same car new could be 20k. If the original buyer still had 22k worth of finance on the car and they'd only get 14 on a trade in, then they're screwed.

Exactly, that is what I'm saying. He or she who holds out the longest, will get hit the least. Those who have already in the recent past or continue to buy new cars in the near future will be penalised the most (if VRT is reduced or abolished).

___

Presently, a 30 year old car, is the only way to beat or stick two fingers up to the current system. Or at least where that isn't practical to buy a nearly-new car where the worst of the depreciation has already taken effect.

TomMc

nipplenuts wrote: »

Except my colleagues in Germany say it didn't work. People with old cars scrapped replaced them with cheap cars: Hyundais, Toyotas etc. Not German cars.

It obviously was a better idea in theory than practise. You would think Germans would buy VW's and Opels as they are generally quite supportive of their home motor manufacturers in the same way the French and Italian are of theirs. But if scrappage schemes only involve bangers, it is logical (granted with an element of hindsight) that people would largely only be buying cheaper new cars. Reliable, value for money Jap and Korean stuff rather than more expensive European offerings.

patmartino

Drummerboy08 wrote: »

http://www.rte.ie/news/2009/1111/beru.html

There's 80 people who had non-sales related jobs on the dole this evening. A month before christmas.

Its people like these who could have their jobs saved if something is done to kick start the motor industry.

Kick start it into what?

The economy is only going to get worse. There is only a market for 50,000 new car sales this year. Next year as recession bites fully it will be even less, in EVERY industry.