The Society of the Irish Motor Industry have issued their second Quarterly Motor Industry Review of 2016 in association with DoneDeal. The SIMI/DoneDeal report highlights the strong performance that the Motor Industry has made in the first half of 2016 with the Exchequer collecting €978.4 million in VRT and VAT receipts from new and used car sales in the first half of 2016, which is 28.5% higher than the same period in 2015. Although there has been some deceleration as the year has progressed, the economic outlook is still positive with total car sales forecast to reach 152,000 by the end of the year.

1. SIMI
Q2 Motor Industry
Review
In association with
DoneDeal
21st July 2016

2. Welcome
Address
Alan Nolan
Director General
SIMI

3. SIMI/DoneDeal
Motor Industry
Review Q2 2016
Jim Power
Author & Economist

4. The Irish Economy in 2016
• GDP +26.3% 2015!!!!!!!
2016
• Q1 GDP +2.3% (YoY): Consumption +5%; Exports
+1.3%
• Retail Sales (Jan-May) Volume +7.9%; Value
+5.6%
• Tax Revenues +9.2% (YoY) €742 m ahead of
profile
• Unemployment Rate 7.8%
• Good solid momentum

5. Consumer Confidence
0.0
20.0
40.0
60.0
80.0
100.0
120.0
140.0
Feb-96
Aug-96
Feb-97
Aug-97
Feb-98
Aug-98
Feb-99
Aug-99
Feb-00
Aug-00
Feb-01
Aug-01
Feb-02
Aug-02
Feb-03
Aug-03
Feb-04
Aug-04
Feb-05
Aug-05
Feb-06
Aug-06
Feb-07
Aug-07
Feb-08
Aug-08
Feb-09
Aug-09
Feb-10
Aug-10
Feb-11
Aug-11
Feb-12
Aug-12
Feb-13
Aug-13
Feb-14
Aug-14
Feb-15
Aug-15
Feb-16

6. Motor Trade H1
• New Car Registrations 101,335: +23.07%
• Roscommon +37.9%; Leitrim +14.5%
• Used Car Imports 32,285; +27.7%
• Light Commercial Vehicles 18,409; +25.6%
• Heavy Commercial Vehicles 1,789; +42%

7. Car Sales in 2016
2015 2016 % CHANGE
Jan 29,808 39,722 +33.3%
Feb 15,778 21,574 +36.7%
March 18,933 21,531 +13.7%
Q1 64,519 82,827 +28.4%
April 9,451 10,382 +9.85%
May 6,919 6,502 -6.03%
June 1,448 1,624 +12.2%
Q2 17,818 18,508 +3.88%
Jan-June 82,337 101,335 +23.07%

8. Monthly Trend
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
2013
2014
2015
2016

9. Imported Used Cars
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
2007 2008 2009 2010 2011 2012 2013 2014 2015 H1 2016

10. Costs of Motoring
60.0
80.0
100.0
120.0
140.0
160.0
180.0
200.0
Jan-05
May-05
Sep-05
Jan-06
May-06
Sep-06
Jan-07
May-07
Sep-07
Jan-08
May-08
Sep-08
Jan-09
May-09
Sep-09
Jan-10
May-10
Sep-10
Jan-11
May-11
Sep-11
Jan-12
May-12
Sep-12
Jan-13
May-13
Sep-13
Jan-14
May-14
Sep-14
Jan-15
May-15
Sep-15
Jan-16
May-16
(Jan2005=100)
Motor cars Petrol Diesel Motor Insurance

11. Costs of Motoring
• New Car Price -3% (YoY); -25% since 2008
• Petrol -8.4% (YoY); +9.9% March to June
• Diesel -12.4% (YoY); +10.9% Jan to June
• Motor Insurance +38.6%; +71.3% since June
2013

12. Brexit -What Happens Next?
• Only UK can decide when to trigger Article 50
• Once Article 50 triggered, negotiation power
shifts to EU-27
• What sort of deal if UK exits?
• Norway has access to EU through EEA – but pays
90% of UK contribution per capita
• Switzerland – bilateral trade deals, pays 50% of
EU contribution
• Have to sign up to rules & regulations of SEM
• Negotiations would take at least 2 years

13. Economic Impact on UK
• 47% UK exports go to EU, 7% of EU exports to UK
• UK pays £20 bln gross, but net <£10 bln
• Lower budget contribution?
• Impact on inward investment
• Lower regulations- spurious argument
• Migration – loss of EU migrants not good
• Short-term exit would be bad for UK economy
• Longer-term the UK economy would have to
adjust
• Exit does not make sense

14. Brexit & Ireland
• Impact on sterling?
• Impact on UK economy?
• FDI – possible opportunity
• UK to cut CT rate to 15%?
• Northern Ireland border
• Impact on EU?
• Many ‘unknown unknowns’
• Difficult to see too many positives

15. GBP v Euro
0.6
0.65
0.7
0.75
0.8
0.85
0.9
0.95
1/1/2010 1/1/2011 1/1/2012 1/1/2013 1/1/2014 1/1/2015 1/1/2016

16. Brexit & the Motor Trade
• Impact of weaker UK economy on Irish activity
& hence car sales
• Weaker sterling will make imports more
attractive, but car imports into UK more
expensive
• Impact of trade restrictions?
• Logistics of trade through UK?
• Uncertainty is the big enemy of confidence

17. New Car Registrations
0
50,000
100,000
150,000
200,000
250,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016f 2017f

18. The Industry 2016 & 2017
• 152,000 in 2016; +21.7%
• Pretty flat in 2017
• Brexit concerns, but key economic factors such
as employment, disposable incomes will
continue to exert positive influence
• Rapid growth of recent years running out of
steam – market approaching natural state

19. DoneDeal Advertising Volumes
0
5,000
10,000
15,000
20,000
25,000

20. THAN ANSWERS!

21. July
Registrations
Alan Greene
President SIMI

22. 20 Day July Registrations
New Cars Total Year to Date
2016 (21525) v 2015 (19,335) = +11% 122,860 +21%
New Light Commercial Vehicles Total Year to Date
2016 (2,657) v 2015 (2,126)= +25% 21,064 +25%
New Heavy Commercial Vehicles Total Year to Date
2016 (304) v 2015 (234) =+30% 2,093 +40%

23. Thank You
• Quarter 2 Motor Industry Review available at
www.simi.ie/quarterlyreport