Those who had postponed changing their vehicles due to challenging economic conditions and hoped to do so in the coming years are currently setting the tone on the car market. Additionally, people who do not have an urgent need to replace their cars but see it as practical, in order to avoid paying the vehicle registration tax due from the new year, are also taking action.

"The top 10 most popular vehicles are really all sensible cars – Toyota RAV4, Škoda Octavia, Volkswagen Passat – they may not necessarily be the most eco-friendly or lowest-tax vehicles, but these are the cars that people want. People are simply deciding to go ahead with the purchase this year. They drove a Volkswagen Passat before and they'll continue driving a Volkswagen Passat next year, but they just want to replace it, either with a newer or a better version," said Tarmo Tähepõld, editor-in-chief of the Autogeenius portal.

According to experts, the used car market is dominated by four- to five-year-old Toyotas, Škodas and Volkswagens. Auto Bassadone, which sells both new and used mainstream cars like Fiat, Citroën, Hyundai, Opel and Nissan, saw a 44 percent increase in new car sales in October compared to the same month last year, while the used car market is more active still.

"Numerically, due to our brand lineup, we naturally sell more new cars. However, the increase in used car sales has been even greater. The used car market, in general, is much more active and this could partly be because people are uncertain about what will happen to the used car market at the beginning of the year when new taxes are implemented, meaning how it will all work out," said Veiko Karu, CEO of Auto Bassadone OÜ.

Auto 100 specializes in the import of Škoda and Porsche vehicles. While there has been a noticeable resurgence in the mass market, this is primarily due to negative sales figures from the first eight months of the year. Despite impressive sales numbers in October, actual market growth has not occurred.

"In October, we set an all-time car sales record for Škoda in Estonia, selling 645 cars to customers – a significant number for the Estonian market. People are clearly buying the typical consumer vehicle that will be most affected by the car tax. Cars that make sense for a person to buy are also the ones that get hit hardest by the tax," said Jussi Pärnpuu, a member of the management board at Auto 100.

Škoda's popularity may have been further driven by an effective advertisement from Rohe Auto, featuring former Finance Minister Mart Võrklaev.

On the other hand, luxury car sales are relatively independent of economic cycles.

"We can divide the luxury car market into two segments: premium and high luxury. The premium segment includes the three major German brands – Mercedes, BMW and Audi. This year, these three brands have seen a notable decline in sales compared to 2023. With Porsche, we've managed to achieve slight growth. Meanwhile, brands like Bentley and Lamborghini remain stable, as their sales don't adhere strictly to typical market rules," Pärnpuu noted.

Bringing a car from abroad into Estonia has become increasingly challenging, as waiting times for registration at the Transport Administration have significantly lengthened.

"Previously, you could perhaps book an appointment for the next day. Currently, it takes at least 10 days just to present your vehicle. Leasing companies – while they indicated a couple of weeks ago that the situation was still somewhat under control – are also experiencing delays. In the past, you might have received a response to a leasing request within a few hours or by the next day, but that is certainly no longer the case," added Tarmo Tähepõld.

One of the goals of the car tax from the start has been to encourage a shift towards a cleaner, more environmentally friendly fleet. One might assume that the current surge in car sales would contribute to this effort.

"I'm not sure if this autumn rush will bring much change, because when thousand-euro or very old and powerful cars change hands, they don't leave the country – they simply get new owners," said Tähepõld.

"The fleet is actually rejuvenated when newer or brand new cars are purchased. It becomes more environmentally friendly when people opt for smaller cars. Electric cars aren't a miracle solution. They are large, heavy and expensive," noted Jussi Pärnpuu.

The car tax is more likely to encourage practical decisions.

"Consumers have become significantly more informed and can better understand the total cost of vehicle ownership over its entire period, making decisions based on that. One factor in this is the annual tax, which involves questions like whether I have access to chargers, whether it makes financial sense to use them and how much driving is needed. The mathematical side of the decision comes into play heavily," explained Veiko Karu.

Due to such varied considerations, plug-in hybrids are becoming increasingly popular on the market, although their purchase price remains out of reach for many consumers.

"According to market statistics, traditional diesel vehicles experienced the highest growth in October, likely because registering such vehicles may become more expensive next year. Additionally, many manufacturers will begin restricting the sale of these cars next year," added Karu.

First registrations in Estonia

In October, 6,936 vehicles were newly registered in Estonia for an increase of approximately 20 percent compared to the same period in previous years. This spike represents a notable surge in sales for October.

Conversely, earlier months of this year saw a decrease in car purchases compared to past years.

Altogether, 55,372 vehicles were registered in the first ten months of the year, over 55 percent of which were new, with the average age of registered vehicles being 3.08 years.

There are, however, significant geographical differences. More than half of the transactions – 31,202 – occurred in Tallinn and Harju County, where there is a higher proportion of new cars, and the average age of purchased vehicles is 2.4 years. In contrast, in Järva and Valga counties, the average age of purchased vehicles is 5.9 years.

According to this year's transaction statistics, the most popular car brands have been Škoda, Toyota, BMW, Volkswagen, Volvo and Mercedes-Benz.

In terms of fuel type, diesel- and gasoline-powered vehicles continue to dominate among these popular brands. However, a new trend shows hybrid vehicles are catching up to gasoline cars in popularity. On the other hand, vehicles powered by electricity and gas have been purchased in much smaller numbers.

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