Large-engine cars losing value

Vehicle data company Cartell report that large-engined vehicles (in excess of 2,000cc) are in decline with their numbers dwindling dramatically, writes Trish Whelan.

Cartell.ie claim there has been a 72 percent decrease in the number of 2-litre vehicles registered in 2012 versus 2007. They say this can be attributed to a number of factors; the introduction of a motor taxation regime which now focuses on penalising vehicles which emit more C02; the waning in popularity of vehicles which are more expensive to run, and changing trends in the market.

Their study of such vehicles over 2,000 currently in the Irish fleet and registered 2000 to 2012, shows a big drop in sales, especially since the introduction of the C02 based regime in 2008 when smaller vehicles, producing less C02, attracted less annual road tax.

“The tax on 10-year-old large engined vehicles can be as high as 40 percent of their value; and even for 6-year-old vehicles can represent anything from 10-15 percent of their value."

The higher motor tax on large engined cars means their residual values are falling faster as recession-hit householders aim to keep annual household costs down. They are also far less fuel efficient. Another factor is the power to litre ratio has increased making smaller engines as powerful as older large engines.

Cartell give as an example how an an owner of a 10-year-old 3.0 litre engine will pay tax in the region of 40 percent of the value of the car in year 10 of ownership, while the owner of a 2.0 engine will pay tax at around 25 percent of the value of the car in year 10.

In conclusion, they see this decline from two different perspectives; the drop in overall numbers in the Irish fleet of cars greater than 2,000cc; and the relatively larger drop in value of large-engine vehicles, taking motor tax as an example.