Europeans snap up old cars to avoid public transport

Madrid

WANT a cheap used car to nip around town without running the gauntlet of coronavirus on public transport? Welcome to Pandemic Motors, we have just what you need. Across Europe, people are snapping up old bangers and clunkers, desperate to avoid buses and trains but wary of splashing out on a shiny new motor in uncertain economic times.

"Public transportation is terrific here, but with the Covid and all that, it's better to avoid it," said Robert Perez, who recently moved to Madrid from Argentina. On the hunt for work, Perez, a 33-year-old automotive engineer, bought a red 2001 Seat Toledo for 2,000 euros (S$3,204) from OcasionPlus, a Spanish used car firm that has opened four new dealerships since the lockdown due to soaring demand.

Data provided to Reuters by research firm IHS Markit and online car market AutoScout24 showed there has been a marked upward shift in registrations of older cars across Europe, as well as a spike in Internet searches for ageing vehicles.

The surge in interest in used cars is neither good news for struggling mass transit networks nor the environment as dirty old cars appear to be more in demand than new electric vehicles. In the longer term, however, the shift away from public transport towards "individual mobility" in the pandemic era is expected to help carmakers, hit by a 27 per cent slump in new vehicle sales across Europe in the first 10 months of 2020.

At Nawaie Motoring's crammed lot in the west London suburb of Hayes, general manager Ameen Sultani points out the older cars selling for under £3,000 (S$5,344) that are in demand. He said prices for the cars, mostly over a decade old, have jumped by 25 per cent as buyers who used to take trains and buses look for affordable alternatives.

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Stronger-than-expected demand for new cars in the United States, Europe and especially China in recent months has helped major automakers recover to some extent from the financial blows pandemic lockdowns delivered in the spring. But an analysis of car registration data in France, Germany, Italy, Spain, Switzerland and the United Kingdom conducted for Reuters by IHS Markit also shows there's a significant shift toward older, used vehicles.

Cristian Lopez, 34, is another buyer in Spain who went for the cheaper second-hand option, partly thanks to having saved some money during the country's strict lockdown. Furloughed from his job at a catering company, he went back to school to study tourism management. This month, he bought a gray 2005 Renault Clio for 3,600 euros to get to classes from his home in the Madrid suburb of Vicalvaro.

In an analysis for Reuters, AutoScout24 said Internet searches for older cars had spiked since the summer. AutoScout24 chief executive Edgar Berger said that while "individual mobility" had become more important to consumers in these markets because of the pandemic, they had also become more cautious because of economic uncertainty. But buyers are still shying away from second-hand electric vehicles, according to OcasionPlus.

Besides the potential setback to ambitious European targets for cutting carbon emissions, there are other, longer-term ramifications from keeping very old cars on the road longer. Older vehicles with fewer safety features might cause more accidents and lead to higher premiums, insurers said, though that will take time to show up in statistics. REUTERS