SIMI warns of fragile recovery ahead of the Budget

The Society of the Irish Motor Industry (SIMI) has underlined the need for stability in its pre-Budget submission to the Government as the sector continues to try and get back on its feet.

The Motor Industry, which employs 41,000 people nationwide, has seen a shift upwards this year with increased sales delivering €783million to the Irish exchequer.

Alan NolanOver 93,000 cars have been sold so far this year, an increase of 30% on 2013. This has helped revitalise the sector and has meant the provision of over 3,000 new jobs in the motor industry in 2014.

Despite the positive increase, SIMI have warned of the fragility of recovery that is underway in the Motor Industry. The figures for 2014 indicate a significant level recovery but this has to be seen in the context of starting from a very low base. 
This steady upward growth with the potential to make an even stronger contribution to the Irish economy would be in serious jeopardy if the Government were to include any increases in either VRT or Road Tax in the Budget.

Alan Nolan Director General of SIMI said; 
“The Industry has seen improved business levels this year, has collected an additional €200Milion for the Exchequer from new car sales alone and has created thousands of additional jobs around the country.
We have now recovered to about 60% of average car sales in pre-recession years but recovery is still very fragile, being dependent on both consumer confidence and levels of disposable income.

“If there are no negative Budget measures that might impact on this recovery then the sector will continue to drive additional tax revenues for the State and create thousands of new jobs,” he said.

Jim Power, Economist commenting at the recent launch of the SIMI Quarterly Report said:
“It is clear that the Motor Industry recovery is making a very positive contribution to tax revenues and employment. It is vital that the Government would do nothing in Budget 2015 to threaten that recovery”.