By Eamon Quinn
The Republic has doubled its second-hand car imports to 100,000 in the past two years, while new car sales have slumped in “a clear and dramatic effect” from the Brexit slide in sterling, according to the Marketing Institute of Ireland and the UCD Michael Smurfit Graduate Business School.
Its consumer market monitor predicts second-hand imports will overtake new car sales next year, at 120,000, if sterling’s slump against the euro persists — it began when the UK voted to leave the EU in June 2016.
The monitor underscores the huge amount of food and household products imported across the Irish Sea into Ireland for sale in supermarkets. “Two-thirds of items on supermarket shelves are imported and that percentage is even higher for clothing and household goods,” said Professor Mary Lambkin of the business school.
“However, despite our reliance on a high proportion of imports for many types of goods, fears of Brexit have not materialised yet in most consumer sectors, except for car sales.
“Car sales are the one sector in which Brexit has had a clear and dramatic effect, driven by the significant fall in the value of sterling which has made car imports cheaper. While this is beneficial to the consumer, it is damaging Irish car dealerships.”
More jobs, more hours worked, and, “to a lesser extent”, pay rises helped drive the growth in consumer spending, said the monitor.
“Pay rates were up by around 2% per annum for the past three years. Increases of about 3% are forecast for this year and a similar rate for 2019.”