Gap between new and old car prices to grow: analyst

Measures taken by western European governments to encourage fuel efficient car purchase are driving increased imports to Poland, making used cars cheaper, PKO Bank Polski analyst Wojciech Matysiak told PolandIN.

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“Car purchase subsidy programmes in France and Germany will increase the supply of used cars to Poland and as the supply of new cars is limited due to the suspension of production during the lockdown the difference between used car prices and new car prices will increase,” Wojciech Matysiak, the co-author of a PKO BP report on the market told PolandIN.

We expect further growth in sales of new and secondhand economy-class cars due to the reluctance of people returning to work after lockdown to use public transport. During the darkest period of lockdown in April this year, passenger numbers on public transport dropped by 80 percent.

The cars that are making their way to Poland, which has the-fifth highest car ownership per head in Europe are not likely to be hybrid or electric like the ones whose purchase is being subsidised by its neighbours. The average age of cars in Poland is 14 years old, according to Samar data, while one third of the cars on Polish roads are over 20 years old.

Poland has its own subsidy programme for electric cars, the numbers of which have grown significantly, albeit from a very low base to just under 10,000. However, according to Mr Matysiak, there is a cap on the value of the cars that are eligible for the subsidy and the subsidy does not apply to leasing. As regards the future, the PKO analyst sees new car production picking up towards the end of the year and into 2021 as demand grows.

“These programmes are designed to encourage the purchase of more fuel-efficient cars- electric cars, hybrid cars, which means that many used cars with traditional engines and diesel engines will be imported by Polish customers and this will increase the supply of used cars to Poland and as the supply of new cars is limited due to production suspension during the lockdown the difference between used car prices and new car prices will increase and this will support purchases of used cars in Poland.”

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