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What is the real impact of Brexit on Irish Motor Traders?

Paid post, brought to you by: Campion Insurance

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From vehicle distribution, parts and equipment to professional services, the Irish motor industry is entwined with the UK. There are significant volumes of cars and commercial vehicles in Ireland, as well as vehicle parts and accessories, that are manufactured in the UK.

There are also a substantial number of cars and commercial vehicles, sourced by Irish dealers from dealers or auctions in the UK, not to mention vehicle parts sourced from UK sellers.

What are the short, medium and long term implications of Brexit?

In Ireland, used car imports total around 50,000 per year, which is a significant volume. In the medium to long-term, there may well be concerns regarding the potential for tariffs and quotas to be imposed on vehicles or parts manufactured in the UK, as a non-EU country.

That said, it’s not just parts manufactured in the UK which will be hit – consideration needs to be given to vehicles or parts, manufactured in another EU member state, but distributed into Ireland through the UK. Although many of these goods are produced in the Eurozone, they are often charged into Ireland in Sterling.

It is though the short-term impact on the Motor Trader industry that is likely to provide the biggest and most worrying challenges, especially in relation to currency fluctuations.

Global financial companies are suggesting the value of Sterling could fall to parity with the Euro – or even further – if the UK leaves the EU with a no-deal Brexit, a scenario looking more & more likely each day.

The key issue here is not the potential for higher volumes of imports, so much as the potential negative impact that it might have on used car values in Ireland. This, in turn, could very well slow down new vehicle sales, if the cost for a consumer to change their car increases as a result of the lower trade-in value. Not only will this impact cars but the same price adjustment will be happening in relation to parts and accessories as well.

Similarly, mutual recognition between Ireland and the UK on vehicle approvals and acceptance of mileage-based odometers may need to be resolved in a changed context. For companies currently trading into Ireland from the UK, there may have to be some adjustment or modification in relation to the most beneficial way to structure for the future.

In summary, there is a lot of uncertainty surrounding the market at the moment. If you need advice or a quote for a Motor Trader insurance policy, please contact Campion Insurance on 1850 577 777 or visit:



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