Richard Ďurana z INESS hovoril pre The Slovak
Spectator dňa 13.7. 2009 o šrotovnom a jeho negatívnom dopade na celé
slovenské hospodárstvo.
DURING the first half of 2009 Slovaks bought almost 41,300
new passenger cars. Compared with the same period of 2008 this was an increase
of 18.4 percent. In June alone, Slovaks bought 10,355 passenger cars: sales
normally average 4,000 to 5,000 units in Slovakia.
The main reason was the car-scrapping bonus, which the
government of Robert Fico implemented earlier this year to revive the local
automotive industry and rejuvenate Slovakia’s fleet of passenger cars. It
pushed car sales up during the first half of 2009 as Slovaks used the bonus to
purchase 20,000 new cars.
“In terms of the effect of the car-scrapping bonus on car
sales and registration of new passenger cars, we can say that these will this
year be at the level of 2008,”
Mária Nováková, the secretary general of the Automotive Industry Association of
the Slovak Republic (ZAP), told The Slovak Spectator. “And when we speak about
last year, we have to note that that year car sales were at their highest in
the 15-year existence of car sales statistics, with total sales of 70,040
passenger cars.”
The bonus, however, does not enjoy universal approval. While
the Slovak Economy Ministry as well as ZAP see the car-scrapping bonus as a
tool to propel the automotive industry and positively influence other segments
of Slovakia’s economy, the Institute of Economic and Social Studies (INESS), an
economics think tank, believes that the bonus has had only a minimal impact on
the local car industry and that the measure has diverted funds from other
industrial branches.
Car-scrapping ‘frenzy’
The Fico government launched the first wave of the car-scrapping
bonus in early March. The basic car-scrapping bonus paid by the state was
€1,000; if the new car seller reduced the sale price by another €500, the state
increased its contribution to €1,500. Thus the car-scrapping bonus could
generate a total discount for buyers of €2,000. The bonus applied only to cars
with a regular sale price of less than €25,000. And the car being scrapped had
to be more than 10 years old and registered in Slovakia no later than December
31, 2008. The government allocated a total of €33.2 million to the project.
Under the scheme, when a car owner brought an old vehicle to
an authorised car-scrapping yard he received a document which he then submitted
to the seller of a new car. It authorised him to receive the bonus, which the car
seller then obtained from the state.
While ZAP, which records car sales in Slovakia as well as
take-up of the bonus, predicted based on its experience that it would take
months to use up the allocation, it took the car-buying public only 13 working
days to deliver 22,100 old cars to scrapping yards and qualify for all the
bonuses.
“It was an ongoing frenzy which meant that scrapyards were
bursting,” Nováková, ZAP’s secretary general, told The Slovak Spectator. “Their
staffs were working in two shifts, there were queues and timed appointments to
deliver a car to a scrapyard.”
After the scrapping bonus had turned out to be so popular,
the government launched a second wave in April. The conditions for car owners
to qualify for the bonus remained the same, but car-sellers had to contribute
more: €1,000 per new car in order for the car buyer to get the state bonus of
€1,000. The government allocated a total of €22.1 million for the second wave.
The second wave was as popular as the first one, and the
allocated funds were used up after only five working days, ending on April 14.
Old car owners arriving after April 14 could not qualify for the bonus; but the
lucky bonus holders can use their bonus up to the end of this year.
In total, the Slovak government allocated €55 million to the
car-scrapping bonus project, to subsidise the purchase of 44,200 new cars. At
the end of June, the number of cars purchased or ordered using the bonus
amounted to 35,897 units, of which around 20,000 were delivered in the first
half of 2009, according to information provided by the Economy Ministry. That
leaves 8,303 bonuses still to be used.
On the basis of ZAP statistics, the average price paid for a
new car within the first bonus wave was €9,098 and the average price in the
second wave was €9,660.
Effects of the bonus
Apart from the aims of reviving the local car industry and
renewing Slovakia’s car fleet, implementing the bonus scheme was also a gesture
of solidarity with other European countries with strong automotive industries.
“Twelve EU countries including Slovakia have supported car
sales by the use of scrapping bonuses,” Dárius Bošjak from the communication
department of the Economy Ministry told The Slovak Spectator. “With regards to
the fact that cars produced in Slovakia are global makes, it is necessary to
evaluate the support to sales within the whole of Europe. Measures to combat
the impacts of the crisis in the EU respect the importance of the automotive
industry, which by the number of jobs it supports, investment in research and
development, turnover, as well as interconnection with other sectors creates
one of the pillars of the current European economy.”
The car industry in Europe directly employs 2.2 million
people, but indirectly supports about 12 million jobs. The annual turnover of
the European automotive industry is €780 billion and the value-added tax
receipts from it exceed €140 billion, according to Bošjak.
Nováková of ZAP shares the opinion that implementing the
scheme has gained Slovakia international respect.
“We as a country are highly acknowledged from the EU point
of view,” said Nováková. “This measure proves that Slovakia has a close
relationship with the automotive industry, that we have solidarity with the
automotive industry and that we are following the path of the whole European
automotive industry.”
Nováková also thinks the decision by Volkswagen to invest
€308 million in its Bratislava plant to produce the new Up! model confirms
this.
“Apart from the adoption of the European single currency as
of January 1, 2009, Slovakia was also positively assessed for joining the whole
of Europe’s efforts to fight the crisis and for its support to the car
industry,” said Nováková. “This [the scrapping bonus] was one of the facts
which influenced the decision about this investment, which Bratislava needs so
much. This is because during a crisis sales of the more expensive models which
are [currently] produced by Volkswagen Slovakia in particular are limited.”
The automotive industry is the biggest segment of the Slovak
economy, according to Bošjak. He said it is of key importance for the
development of GDP, exports, employment, attracting investment and overall
qualitative changes in industry expressed in terms of high quality,
productivity, innovations and high technology. Sub-contractors play a key role
in production, and technological and regional diversification, with positive
impacts on employment and the development of small and medium-sized businesses,
he added.
Nováková of ZAP said the biggest impact of the bonus scheme
in Slovakia was on the subcontractors which supply components not only to
Slovakia’s car industry but to the whole European industry.
But Richard Ďurana,
director of the Institute of Economic and Social Studies (INESS), an economics
think tank, is critical of the car-scrapping bonus scheme.
“The car-scrapping
bonus had only a minimal impact on the local automotive industry; it had a
positive impact in particular on car sellers, who were behind its
implementation,” Ďurana told The Slovak Spectator. “However, it is impossible
to speak about a positive impact in the case of the whole of Slovak industry.
The support to one selected industrial branch has diverted funds from other
branches, which were hit by this measure because customers delivered their
savings to car sellers. Moreover, politicians, by introducing this bonus,
motivated people in a time of crisis to spend their savings and even to go into
debt.”
Nováková disagrees, saying that 55 percent of car buyers
using the scrapping bonus are more than 50 years old.
“This age structure means that these are people who we
cannot describe as daredevils,” she said, adding that they are instead people
who think through the purchase of a new car thoroughly and belong to a
generation which is used to living without loans.
The contribution of
the bonus to economic growth
The National Bank of Slovakia (NBS) has calculated that the
direct effect of the car-scrapping bonus project on the growth of gross
domestic product (GDP) is about 0.05 percentage points, the TASR newswire
reported.
By Ďurana said it is
too early to calculate the impact of the bonus on economic growth.
“This is because the
bonus has concentrated some of the car sales for the whole year into three
months.” Ďurana said. “Thus it will be possible to estimate the impact of the
bonus only at the end of the year, when the calculation will also include the
expected drop in car sales during the second half of the year.”
However, according to
Ďurana, even that estimate will be of only limited value since it is impossible
to say how many cars would have been sold without the support of the
car-scrapping bonus.
An average 14
year-old
One of the objectives of the car-scrapping bonus was to
rejuvenate Slovakia’s fleet of passenger cars.
According to Nováková, the average age of a passenger car in
Slovakia is more than 14 years.
At the end of 2008, there were almost 1.6 million passenger
cars registered, of which 39 percent (621,869) were 10-19 years old. One
quarter of the passengers cars in Slovakia were 5-9 year-old cars (404,364
units), followed by 20 percent (313,698 units) which were 1-4 years old. 20-29
year-old cars numbered 205,994 units, or 13 percent. Three percent of passenger
cars, or 53,926 vehicles, were over 30 years old.
According to the ZAP database, the average age of cars
brought for scrapping within the bonus scheme exceeded 19 years.
Nováková believes that the replacement of old vehicles with
new ones, which are safer, more effective as well as more environmentally
friendly, will have positive impacts on road safety as well as the country’s
environment.
Among other effects which Nováková said the bonus scheme has
brought are the restoration of consumer confidence and the flow of finance.
“The financial crisis is also caused by the missing flow of
finance and thus by supporting the confidence of customers to purchase a
certain product, the flow of money has been re- started,” said Nováková.
The
Slovak Spectator, 13 Jul 2009 Jana
Liptáková
