A Roscommon car dealer who spoke to thecircular.org said that his customers are not ready for electric cars. “They are very much the preserve of lifestyle buyers and in terms of the product lifecycle, they definitely at the ‘innovators’ stage,” he said.
The 2008 budget changed the basis of taxation on cars to CO2 emissions. As a result, the price of diesel cars came down to the level of petrol cars. This made a switch from petrol to diesel economic for all car buyers.
Manufacturers switched the focus of their research and development efforts to producing even more efficient diesel engines, thereby further reducing VRT and annual road tax. By 2013, even German-manufactured premium cars attracted low tax rates.
According to a spokesperson for the Society of the Motor Industry (SIMI): “As a result (of the policy changes), those consumers who were in a position to buy a new or used car, during that very difficult period, only wanted to buy a diesel, whether it was the most suitable for them or not.”
Other changes that have taken place in the market include the introduction of personal contract purchase (PCP), the disappearance of alternative fuel types (ethanol) and the increase in UK imports. The latter have become economically attractive in recent years owing to depreciation in sterling and reductions in VRT due to reduced CO2 emissions, especially for diesel engines.
The CSO records statistics for registration of new private cars bought in Ireland and second-hand private cars imported from abroad (i.e. mainly UK imports).
Last year 121,157 new cars were registered. Of these, 54 per cent (65,814) were diesel. In the same period, 99,456 cars were imported, 75 per cent of which were diesel. Overall in the year, a total of 220,613 cars were registered, 64 per cent of which were diesel.
While sales of new diesels are down, the proportion of diesel cars being registered for the first time remains high. Reverse import substitution of second-hand diesel imports compensated for the reduction in domestic registrations.
Hybrid and electric car registrations combined accounted for 15,145 or 7 per cent of the total in 2018. One thousand, nine hundred and twenty-two were electric or slightly less than 1 per cent of the total.
The following table from the CSO shows the total number of private cars (including imports) registered from 2014 to 2018, by fuel type.
Representing this table in percentage format we can see that there is a significant shift away from diesel with total registrations (including imports) falling from 77% in 2014 to 64% in 2018. This has been accompanied by a rise in petrol to 29% in 2018 and hybrids to 6%. While there has been a substantial increase in the number of electric cars registered in 2017 and 2018, the proportion of electric cars registered is insignificant in the overall market context.
Commenting on the situation, the SIMI stated: “Diesel is very much the fuel of business, and it is the fuel of rural Ireland”.
The problem, however, is that diesel engines operate at higher temperature than petrol leading to higher nitric oxide (NOx) emissions. According to the European Environment Agency NOx is a greenhouse gas which at high concentrations has adverse health impacts, including inflammation of the airways.
Policymakers will be disappointed with the continued strong performance of diesel units in the market and the low take-up of hybrid and electric models, despite strong financial incentives in favour of the latter.
What is inhibiting sales of electric and hybrid vehicles?
Price, battery range, charging times and lack of charging infrastructure are problematic. The technology surrounding electric and hybrid cars is evolving year on year, and there are continuous improvements both in terms of battery life and drivetrain configuration. But this high level of innovation is indicative of an unstable, immature technology, and the eventual direction of travel is uncertain.
One obvious problem is that recently bought vehicles become obsolete more quickly. This, in combination with the need to replace batteries at high cost means that depreciation of these vehicles is going to be much higher than for conventional cars, thereby adding substantially to the lifetime cost of ownership.
For now, it seems there is a lot of uncertainty as to how, and how fast the technologies and consumer preferences will develop.
Here’s a review of the Nissan Leaf electric car by Carsireland.ie:-