Revenues from car servicing will drop by between 5 and 10% inthe wake of the Government's decision to raise VAT to 24%,according to car dealers' estimates, while sales of new cars willbe propped by the old car scrappage scheme. "Car parts will be moreexpensive, both on the raised VAT and the rising exchange rate andclients will think twice before taking their cars to a servicingcentre," said Viorel Niculescu, controlling Land Rover and Jaguardealer, ATT, and who previously held the position of generalmanager of Romcar, Ford importer domestically. This is the secondblow servicing centres have been dealt, which are at presentstruggling to keep car centres afloat after sales plummeted by morethan 70% from the 2008 level on the shrinking number of personssealing comprehensive policies. Against the new background, carmarket players are no longer expecting a car sales rebound in thesecond half, but are now only hoping for stagnation, a pace thatwill not ensure a level of 100,000 units this year, after in thefirst five months the market lost over 30% from a year ago. The 5%VAT raise will drive up the average price of Dacia Logan by 300euros, while a small car like VW Golf and Opel Astra will become500 euros more expensive and a SUV or luxury car will cost over2-3000 euros more.
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