More than 146,000 cars were sold in this country last year - contributing €1.5bn to the economy.
The figures represent an increase of 17.5% on 2015.
The average price of a new car is now 5.5% lower than 12 months ago, but petrol prices are up almost 2%.
There has been a steady start for sales so far this year - with 142,000 sales expected this year.
Alan Greene SIMI President commented “The Motor Industry continues to be a strong contributor to employment with 40,800 people employed throughout Ireland.
"Last year our Industry contributed €1.5 Billion to the Exchequer in car sales alone. 2017 was always going to be a more cautious year for businesses, right across the economy, but we have seen a steady start in January and hopefully we are on track for another good year and continuation of a stable market during the rest of the year”.
The SIMI/DoneDeal Review outlined that the cost of motoring in 2016 which has seen an increase in in petrol +1.9% and diesel prices +3.2% (Dec 2016 vs Dec 2015), along with the average price of a new car has declined by 5.5% (Dec 2016 vs Dec 2015). Motor insurance costs since 2013 have increased by +61.5%, although there was a slight decrease in the last quarter of 2016 by -5.5%, costs in December still remained at 8.9% higher than a year earlier.
Figures from DoneDeal, Ireland’s most popular motoring site also highlight the sustained upturn in the motor industry in 2016 with the volume of ads published in their Motor section increasing by 9.3%, represents a €5.4 billion in the value of goods advertised in DoneDeal's Motor Section.
Cathal Cremen, Commercial Manager of DoneDeal’s Motor Section, said; “2016 proved to be another exceptional year for DoneDeal in terms of traffic growth and adverts placed on the site. Motoring again proved to be the most popular section of the site with 663,336 cars alone advertised on DoneDeal in 2016."