Mercedes-Benz Ireland identified a new threat to the car industry within its territory. The company said fake registrations are causing a shift in the balance of the market.

According to Ciaran Allen, sales manager of Motors Distributors Limited (MDL), which is the privately-owned importer for Mercedes-Benz vehicles in Ireland, the Irish car market could be on its way to a major financial implosion. In his interview featured in The Irish Times, he identified the increasing levels of pre-registering and hire-drive sales as factors that could potentially inflate the market. He claimed that it would hurt the country’s car industry more than the fluctuations of the Sterling exchange rate and the level of imported cars.

Allen blamed the competition for employing such devious tactics. He explained that such method could result to the fall in the value of used cars.

Citing the market research of Mercedes, Allen noted that the instances of last-day-of-the-month sales figures of their rivals are going up. That triggers their consecutive record-sales.

The last day sales are often treated as pre-registered autos. Examining it closely will reveal that it is only the importers and dealers selling the car to themselves so that they could boost their sales figures as well as market share, and eventually get bonus payments from them. However, that would mean that the vehicles would be sold at a massive discount. Together with the arrival of cheap imports from UK, it could further distort values, especially in used cars.

Allen added that if such practice is removed in the picture, it would show that Mercedes-Benz is really outselling its major rivals, BMW and Audi.