02.02.2009

New car sales plummet – SIMI confirms

New car sales plummeted by almost 67 per cent in January, new figures released by the Society of the Irish Motor Industry (SIMI) reveal. New car sales for the totaled 15,929 units compared to 47,609 units for the same month last year. The introduction of changes to VRT and Road Tax in July 2008 and the announcement of an early budget stalled the market and there has been no recovery since, according to SIMI. The implications of the banking industry collapse has further compounded the increasingly tough market conditions.

The stark contrast between the January 2008 figures, and last month are indicative of the altered state of the country’s economy. In 2007 the VRT and VAT generated by new vehicle registrations reached €2billion. This figure contracted to €1.5billon in 2008 and it is estimated that, unless action is taken swiftly by the government, VRT and VAT revenue for 2009 could drop to €500million.

“The January sales results come as no surprise to SIMI and we predict new vehicle registrations to fall below 100,000 units this year,” SIMI director general Alan Nolan commented. He added: “Our members are under immense pressure and face extraordinary challenges in ’09. Already the industry has suffered 3,000 redundancies and substantial cuts in salaries are affecting many more, particularly those who work on commission basis.”

“Poor figures for January are of little surprise given the current state of the global economy and weak consumer confidence. There is movement in the used car market and our members are diversifying their businesses and responding to demand for servicing and parts, which is a logical shift in business given the increasing numbers keeping their cars for longer.”  “It is crucial at this point that the government supports the industry and takes real and immediate action to boost the industry and prevent the potentially devastating consequences of continued decline.”

Light Commercial Vehicle registrations for 2009 (1,651) are down 80.55% on the same period last year (8,490). Heavy Vehicle (HGV) registrations are down 67.4% (267) for the year to date compared to the same period in 2008 (819).

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