Brexit knocks new car sales

New car sales have fallen this year as the uncertainties surrounding Brexit helped knock the still fragile confidence of Irish consumers, according to industry experts.

Figures published yesterday by the Society of the Irish Motor Industry (Simi), the industry body that collates the sales data, showed that new car registrations in March were almost 7.5% lower from March 2016.

At 75,967, new registrations were down over 8.25% for the first three months this year from the same period in 2016.

The drop in registrations has spread to commercial vehicles and trucks too.

At 13,414, registrations of light commercial vehicles since the start of the year were 10.7% down from a year earlier, and registrations of heavy good vehicles were also down, by almost 2.75%, over the first three months this year from the same period last year.

Alan Nolan, director general at Simi, said despite timing issues which had boosted sales early last year that total new registrations would likely be down for the whole of 2017 compared with 2016.

He said although the economy is the fastest growing in Europe that consumers were still wary about their financial future, a key factor that influences buyers purchasing big ticket items.

He said surveys showed consumer confidence surged last year but started to slow again at the time of the UK’s Brexit vote in June.

Consumers are still uncertain about their own finances, and Brexit will have an effect under those conditions, Mr Nolan said.

Michael Rochford at Motorcheck.ie said the fall in car registrations was “quite sobering”.

He said that Brexit and the fragile state of consumer confidence had contributed to the slowdown.

“The dip in sales is largely down to uncertainty in the economy caused by Brexit, while the strength of the euro against sterling has made it very attractive to import used vehicles from the UK and consequently many people are opting for a nearly new import rather than a brand-new vehicle,” he said.

Separately, the latest survey of Irish purchasing managers by Investec showed the growth in output slowing in March.

Its purchasing managers’ index eased to 53.6 from 53.8 in February.

However, any reading over 50 means that output is still growing.