Breaking News! Too many old cars on Spain's Roads.

A Rolls Royce. A car for Life!

I had intended that my blog for today would be a continuation of the story of the all-important role of the ambulance. However, during the week it was reported that the Dirrecion General de Trafico of Spain has deemed that the age of cars on Spain's roads is too old. It seems that the average age is 9.5 years, and the DGT deems 7 to be more acceptable.

I imagine that one reason people are holding on to our cars longer is that the country is firmly stuck in an economic situation unlike any before it, with more than six million people unemployed, and those who are employed unsure of tomorrow. When talking about reducing the age of cars the complexity of such a program is off the scale.

To begin with, the average budget family car will have a normal life cycle of about ten years. After that you will find it will spend about as much time in the garage as on the road. Top of the line cars have about 20 years as a normal life cycle, and after that they start getting familiar with the garage. So, these should not even be considered as old cars until they are about 25 years old. With many top brand names costing close to 200,000 euros, they had better last and last.

If your parents gave you a Rolls Royce and chauffer for your eighteenth birthday, you will have no need to ever change the car. The chauffer yes, but the car will outlive you. 

When the consumer buys a car and just holds on to it forever the impact is felt by the manufacturer and staff, and by the sellers of new cars. I'm not even sure it would be safe to say that we would all probably like to change our car for a newer model every year if we could. I have two old cars: one is a Jaguar XJ6 Sovereign, in mint condition. It is my classic. The other is a Volvo 850 GT that does the heavy lifting every day. It is such a well made machine, and so reliable that I absolutely love it. If I could dump it and buy any new car that I wanted I would still hesitate to do so because it is like my comfortable old slippers.

What Spain needs is a turnaound in its economic fortunes that put people back to work. Managing a country has always been about timing of its growth. There are certain fundamentals that are ignored at peril. The one that was ignored was the runaway building boom that has resulted in the over stock of homes and commercial buildings.  Everybody was so caught up in their own world of commissions and bonuses that no-one said "Hold On!"

The economy has always moved in an up and down cycle. Proper management provides for both cycles to be as short as possible. Spain has committed the ultimate sin by allowing the construction sector to go wild and build into a twenty-year future. That means that the country has so much vacant stock that it does not need to build another thing for about twenty years. Every person, every family that leaves the country in the meantime makes the housing situation worse as they vacate their space. It is construction that usually leads the way out of the downturn, but Spain does not have that ability, so I cannot see how we will get out of this hole.

Sure, if people scrap their old cars for new ones, that would maintain work for the manufacturing sector and their suppliers, and the new car sales industry, but if the DGT simply refuses to relicense old cars where will the money come from to buy new? Needless to say, we need our cars to get around. They are not a luxury!

Some times in this country we come up with ideas without connecting all the dots. I hope this is not another one of those.

Copyright (c) 2013  Eugene Carmichael