DoneDeal Car Price Index: Electric and hybrid vehicles hold value
Electric and hybrid vehicles hold value as prices increase by 19% year on year and 25% year on year respectively.
DoneDeal’s Motor Price Index is the result of independent third Party economic analysis of DoneDeal’s data by economist Tom Gillespie.
The pandemic, Brexit-induced shock to the market, and now, the war in Ukraine has had a staggering effect on prices in Ireland.
The price of used cars continues to grow at unprecedented levels in 2022. In the first three months of 2022 used car prices have increased by 7.9% quarter on quarter, the tenth consecutive quarter of price increases observed in the DoneDeal dataset. In the past year price inflation has averaged at 2.1% per month, amounting to a 30% annual rate of inflation. The overall inflation figure now stands at 53% if we compare current prices to the onset of the pandemic in March 2020.
In previous years the supply of used cars in Ireland was aided by the glut of Celtic Tiger year cars. However, this ageing cohort of cars are rapidly becoming obsolete, hitting the lower end of the market hardest, with an observed annual rate of inflation of 36.9% for low value cars. This contrasts with a more modest 20% rate of inflation in the upper end of the market for the same period.
Supply chain disruptions caused by global chip shortages stalled the production of new cars, putting supply pressure on the used car market which was already experiencing increased demand as a result of the shift to remote work and reduction in public transport use. In Ireland, Brexit effectively halved (47,034 in 2021, 108,083 in 2019 representing a 56% decrease as per SIMI) the number of used cars being imported from the UK , our nearest accessible car market who share the same side of the road as us. Prices in 2020 and 2021 continued to rise on a monthly basis.
In Ireland, Brexit effectively halved (47,034 in 2021, 108,083 in 2019 representing a 56% decrease as per SIMI) the number of used cars being imported from the UK , our nearest accessible car market who share the same side of the road as us. Prices in 2020 and 2021 continued to rise on a monthly basis. As the lockdowns from the pandemic began to subside at the start of 2022, a potential for supply re-adjustment was on the horizon.
The war in Ukraine has cast doubt on the ability of the global supply chains to catch up in the short term as inflation is biting across most markets. Volkswagen usually produces 1,200 vehicles a day in their plants
With the largest range of both NEW and USED Electric Vehicles available in Ireland, DoneDeal’s data set gives us a unique insight into the market dynamics for more fuel efficient vehicles.
On DoneDeal, prices for used hybrid vehicles have increased by 25% year-on-year (19% for EV’s). This is a significant increase considering the fact that the average price for a hybrid vehicle is just over €24,000 in the DoneDeal dataset.
The upper end of the market for petrol and diesel cars (cars above €18,000) has seen prices rise by 20% year-on-year. Petrol and diesel market share is down from 79% in 2020 to 53% in Q1 2022 for new vehicles (SIMI).
The quarterly rate of inflation for cheaper cars (less than €4,000) is down to 9% from a high of 10.1% in the previous quarter, perhaps reflecting consumer shift away from older and more costly to run cars to more efficient new models.
Methodology
Over 90% of dealer car stock is on DoneDeal. DoneDeal is the largest car marketplace in Ireland, listing 9 out of 10 cars advertised online from car dealerships in Ireland. Economist Tom Gillespie analysed over 5m of DoneDeal’s vehicle listings from 2011-2022 using hedonic regression analysis to isolate pricing inflation associated with vehicles after controlling for mileage, age, and other vehicle attributes. DoneDeal has the largest range of Electric Vehicles for sale in Ireland.
