Car Rental Shortage Fears For Clare Tourism

Business & Finance - Tourism

Thursday, 25 March 2010 01:00

Written by Pat Flynn

Hotels and guesthouses across County Clare are facing a year without seeing any tourists because of the lack of vehicles available to the car rental sector.

Ireland's largest independently owned car rental company is predicting a devastating crisis for the tourism industry and has warned that the severe shortage of cars in the rental fleet across Ireland could cost the coming tourist season over €200m. A recent report on the car rental shortages has confirmed that the number of cars available to tourists has fallen from 30,000 in 2006 to just over 12,000 last year.

The car rental industry is blaming government changes to the VRT rebate system as well one of the main causes of the crisis. The scheme was introduced in 1991 by the then Minister for Tourism Charlie McCreevey to help resolve precisely the same problem when it arose at the time. Other factors included difficulties getting finance from banks to help deal with the crisis and the collapse of the second-hand car market which has left dealers with no place to sell vehicles when they want to change their stock.

Mr Pat Dooley of Dan Dooley Motors has warned: "The rural tourist establishment will not see a visitor this year for the lack of cars. B&B's and hotels will get no tourists because there will be no cars. There will be pandemonium. The shortages will be felt by visitors over the Easter break but the the problem will worsen over the summer. This is a crisis and but there is an immediate solution."

Mr Dooley said: "The rebate scheme, which allowed us claim back 15% of the VRT we paid on cars, was withdrawn last year. Minister Lenihan scrapped it in October claiming the scheme was being abused. If it was, it was by a small minority. If the scheme was reintroduced it would go a long way to alleviate the problems we are having with getting finance for new cars. The new Minister for Tourism Mary Hanafin must to deal with the issue as a matter of urgency and she has the power to sort it before it is too late."

Shannon Development has also expressed grave concern for tourist industry as a result of the crisis.  Tourism and Marketing Division Manager, Pat Daly said: "The car rental sector is a key component of the tourism economy. One third of all overseas holidaymakers hire a car while in Ireland and the projected shortage in the car rental fleet will have major knock on effects for all sectors of the tourism industry. It will have a devastating effect on the reputation of Ireland as a premier holiday destination if visitors are forced to cancel holidays as a result.

"We have called on Government to postpone the reduction of the VRT refund scheme; to maintain the VRT refund scheme for automatic and larger vehicles favoured by the North American tourist market, and to introduce short term consumer measures to allow trade in of older cars against 2010 car hire registered vehicles. We will continue to urge Government to resolve this critical issue for Irish tourism," Mr Daly said.