NEW car sales for the first quarter of the year are down a dramatic 14% on last year.
In all, 39,511 new cars were sold in the first three months of the year, compared to 45,840 last year. In unit sales the decline is 6,329 cars.
Sales in March were down 10% with 1,356 fewer cars sold in the month.
Alan Nolan, SIMI’s Director General said the first quarter of the year was always a crucial period for the motor industry.
“Traditionally it is a good indicator of how sales will perform for the rest of the year,” Mr Nolan added. “Half of all new car sales are usually done in the first three months of the year.
“Based on current figures, we are predicting a new car market of 70,000 this year, slightly down on our original expectations.
“Even this reduced estimate for the year hides a very tough marketplace in the sector. In reality, the natural market is actually significantly poorer and the industry is having to drive sales with really strong offers to consumers.
“Although the Exchequer benefits in the short-term from such industry-driven sales, in the longer term, VRT and VAT income is likely to be negatively impacted in due course.
“The industry must sell cars that were ordered and in the pipeline for this year based on the original expectations, but a bad experience this year is likely to lead to a much more conservative view of next year’s market. This will impact on tax revenues next year.”
At the moment, though, all of this was good news for the consumer with very strong offers available on new cars and with a shortage of good quality used cars in the market-place, trade-ins were in huge demand, he added.