Bucking other trends in the rebounding economy, sales of new cars in September fell sharply compared to a year earlier, according to the Finnish Information Centre of the Automobile Sector.
The automotive industry said that order backlogs are high, but that a shortage of components at car factories has hobbled manufacturing of new cars and caused delivery delays.
The automotive industry predicts that delivery delays will cut registrations across Europe this autumn, despite strong demand for cars.
Domestically, it expects a rise in demand for electric and plug-in hybrid cars towards the end of the year due to the government's decision to waive purchase tax on them as of Friday 1 October.
Brisk trade in used cars in September
Demand for new cars has returned to close to pre-pandemic levels, but delivery delays will lower registrations of new vehicles this autumn, the centre said on Friday.
It blames the component shortage on the rapid economic growth as the pandemic subsides in many parts of the world. Poor availability of components has caused disruptions in the production of all types of vehicles, it said.
Overall this year, new passenger car registrations are up by 7.2 percent from the corresponding period of last year, rising to nearly 79,000.
However in September, only about 6,500 new passenger cars were registered, down by 22.4 percent from September last year.
In the first nine months of the year, registrations of new vans were up by nearly 10 percent, but September's tally was down by 8.5 percent from a year earlier. Similarly, registrations of heavy lorries are up by 7.3 percent this year, but sank by more than 20 percent last month.
Due to the lack of supply of new vehicles, some buyers seem to be opting for older cars. Sales of used cars have been flat for most of the year, but edged up by 2.4 percent in September.
Industry calls for extension of EV subsidies
Of passenger cars registered in September, 30 percent were rechargeable, with 19 percent being rechargeable hybrids and 11 percent fully electric vehicles (EVs).
"Registrations of new electric cars were lower than normal in September, as the car tax, which was abolished at the beginning of October, postponed the registrations of all-electric cars to October," said Pekka Rissa, Managing Director of the Finnish Central Organisation for Motor Trade and Repairs.
The abolition of the car tax will reduce the sticker price of the average EV by 1,500 euros, the centre estimates. Together with purchase subsidies for electric cars, it says the incentive to purchase an EV will increase to almost 3,500 euros.
The purchase subsidy, which is due to expire at the end of the year, should be extended as a matter of urgency, the industry lobbies argue. They note that the average price difference between an electric car and a corresponding internal combustion car is still almost 20,000 euros.
The automotive industry estimates that the abolition of the car tax, together with purchase subsidies, will increase the number of all-electric cars on the road by about 35,000 between 2022 and 2030. As a result, the CO2 emissions of the nation's car fleet are projected to decrease by almost 75,000 tonnes by 2030.
“The tax change also supports companies' transition to electric cars and complements the support for the purchase of electric cars for households, as it focuses on lower-cost models. Companies procure just over a third of new passenger cars, but are currently completely excluded from the purchase subsidies for electric cars,” noted Tero Kallio, CEO of the Automotive Importers and Industry Association, in the statement.
The Finnish Information Centre of the Automobile Sector is run jointly by the Finnish Central Organisation for Motor Trades and Repairs and the Association of Automobile Industry in Finland.