Malta counts cost of driving on the left, as Brexit hits used-car market hard

Together with red telephone boxes and roast dinners, driving on the left is one of Malta’s endearing throwbacks to our time under British rule.

But now, driving on the left is severely hamstringing Malta’s used car dealers, as importers must pay as much as 32 per cent more to bring over second-hand vehicles from the UK, a cost that is inevitably being passed onto the consumer.

The main culprit for the steep increase is Brexit, since when the UK was still part of the European single market, used car imports were not subject to tariffs.

“The current situation is very difficult – we’re basically in a handicapped state,” said a representative of Ventur Motors in Mosta, adding that it was now only feasible to import cars less than three years old, as these vehicles are not subject to customs tax.

And importing from other right-hand-drive countries in Europe like Ireland and Cyprus is out of the question, since these countries themselves also import from the UK and therefore don’t have enough cars to go around.

“Having said that, we’re still managing to cope, especially thanks to luxury vehicles, as well as Japanese imports.”

On the other hand, Mario Galea, of Mario Galea New And Second-Hand Cars, said he was seriously contemplating calling it a day because of the difficulties.

“The exchange rate is against us, plus VAT and customs tax, and the grants for buying a second-hand electric car are too low. Not everyone can afford to spend €36,000 on a new electric car. For a small business like mine, it’s no longer feasible,” he said.

Indeed, all importers spoken to by Businessnow.mt called on the Government to increase the grants on purchasing used electric cars – currently between €1,000 and €2,000 – and bring them in line with grants on new cars, which can reach as much as €12,000 when also scrapping a car with an internal combustion engine.

“We are currently lobbying the Government to make this happen, as it would not only help us, but also increase the stock of electric vehicles on the road and enable low and middle-income people who can’t afford a new car to go electric,” the Ventur representative said.

Last week, Businessnow.mt reported how waiting lists to buy a new car are as long as nine months, due mainly to the global chip shortage. With an average of 55 new cars added to the roads each day in the first quarter of 2021, it remains to be seen whether the car industry’s woes will translate into less traffic.