2017 continues to be a disappointing year for new car sales at both a UK and Northern Ireland level. New car registrations in Northern Ireland fell by 9.3% y/y last month.  This compared with declines of 10% for Scotland and Wales and almost 6% for England. August represented the fifth successive month of year-on-year declines for both Northern Ireland and UK dealers. Indeed, Northern Ireland has only posted one month of year-on-year gains (March) in eight months and this was linked to changes in vehicle excise duty rates (VED) which artificially inflated sales in March.

Local car showrooms experienced their worst August for sales in five years with 3,647 vehicles sold.  This is some 30% below the figure recorded a decade ago which coincided with Northern Ireland’s unprecedented property boom. Back then, housing equity withdrawal frequently found its way to car showrooms.

Year-to-date (Jan-Aug) there have been fewer than 40,000 new cars sold (39,580) which is almost 6% lower than the corresponding period in 2016. So far, this marks the weakest year for new car sales in Northern Ireland since 2013 (37,762) and compares with almost 52,000 in 2007. In recent years, the premium brand market has outperformed the overall market. Therefore the headline declines in new car sales are concealing contrasting performance between different brands – with fewer overall sales, it is competitive market and those brands that adapt to consumer needs and wants will do very well whilst those that don’t, won’t. Indeed, some brands have been posting record sales figures while others are experiencing multi-year lows. As a result, the second-hand market has become more important for an increasing number of new car dealers.

While showrooms may be hoping for an Indian Summer in new car sales, this autumn is likely to see the recent trends continue. Consumers are experiencing a squeeze on their living standards with rising fuel and food prices. Petrol and diesel prices have started to climb in recent weeks. Indeed, this week saw the average price of a litre of petrol / diesel increase for the eighth successive week. Meanwhile the battle of the brands will continue with competition in the second-hand market also expected to heat up.