New figures from the Society of the Irish Motor Industry (SIMI) show that 7,865 new cars were sold in April compared to just under 10,400 in the same month last year.
SIMI director general Alan Nolan said the latest data supports the previously-held expectation 2017 could be an unpredictable year for the industry.
“Vehicle registrations for April show a decline in all sectors and across nearly all counties,” said Mr Nolan.
“While the economy continues to strengthen, consumers appear to have remained somewhat more cautious to date.”
Mr Nolan recently warned that although the Irish economy is the fastest-growing in the EU, consumers remain wary about their financial future, which is influencing them over big ticket purchases.
However, there was better news for the wider economy, with manufacturing activity showing a bright start to the second quarter.
New export orders boosted manufacturing output in April, monthly data showed — Investec’s manufacturing purchasing managers’ index (PMI) hitting a three-month high.
“The outlook for Irish manufacturing firms remains positive, supported by the improving international backdrop,” said Investec Ireland chief economist Philip O’Sullivan.
“One of the key highlights is the new export orders index and firms continue to invest in providing additional resources to meet this rising client demand as evidenced by the expanding employment component.”
On a whole, eurozone manufacturers began the second quarter at a blistering pace, increasing their activity at the fastest rate for six years as demand remained strong despite rising prices.
IHS Markit’s manufacturing PMI for the eurozone jumped to 56.7 in April from March’s 56.2, reaching its highest level since April 2011.
British factories also had their best month in three years in April, the clearest sign yet UK manufacturers are enjoying at least a temporary boost from the pound’s fall after the Brexit vote and an improving global economy.
The Markit/CIPS UK manufacturing PMI jumped to 57.3 from 54.2 in March, exceeding all forecasts.
Sterling received only a temporary lift from the PMI figures after hitting a seven-month high against the dollar on Friday.
Traders were more focused on media reports that the EU is taking a tough stance on Britain’s exit from the bloc.