New car sales down 10.7% as Brexit dampens market

Electric car sales surge ahead with diesel dropping below 50% of new car market

Volkswagen is the most popular brand of new car so far this year, with 7,225 registrations.

Volkswagen is the most popular brand of new car so far this year, with 7,225 registrations.


New car sales are down 10.7 per cent on last year with 64,098 registrations up to the end of March. The motor trade is warning that Brexit uncertainty and an effective increase in the tax paid on new cars is having a negative impact on the market. At the same time, used imports rose 2.74 per cent to 26,832.

Sales of electric cars continued to surge ahead of last year with 1,437 sales in the first three months, more than the total number of electric vehicles registered last year. With a greater range of fully electric models now on offer, Hyundai is the most popular brand for electric cars, with 585 sales, ahead of Nissan with 533. It’s Leaf model is the most popular electric car, ahead of the Hyundai Kona. Tesla is the only electric car brand to record a drop in sales, down from 45 in the first quarter of last year to 22 this year. Jaguar has recorded 18 sales of its award-winning I-Pace fully electric crossover in its first three months of 2019.

Diesel engines now account for less than 50 per cent of new car sales, with petrol electric hybrids now making up 8.7 per cent of registrations, while fully electric cars account for 2.24 per cent.

Higher taxes

According to Brian Cooke, Society of the Irish Motor Industry (SIMI) director general designate, while new car sales are being dampened by Brexit uncertainty, the increase in Vehicle Registration Tax (VRT) on new cars this year, arising from the fact that no allowance was made for the first step in the move to the new WLTP emissions testing regime, has also had a negative impact.

Ireland is the only country in the EU that has sought to charge consumers higher registration taxes due to the improved emissions testing regime,” he said. “While the VRT increases in this first phase of the transition to the WLTP, test figures only saw an average increase of 5 per cent in the CO2 values; the second phase next year will see these increasing by a further 21 per cent.”

With VRT rates linked to a new car’s official emissions, this means prices have been forced up.

“All other member states have followed the EU Commission view that consumers should not be faced with increased taxation due to the improved emissions testing regime.

“SIMI had warned that not adjusting for such large increases in CO2 values will burden the consumer, damage new car sales and will actually reduce State revenues. This has been the case as the decrease in new cars sales has meant that the State’s tax revenues from new cars have fallen by more than €60 million so far this year, and this shortfall is only going to increase as the year progresses.

“While current low volumes in the new car market have largely resulted from lower used car values for consumers’ trade-ins due to the huge volume of used car imports from the UK due to the Brexit-driven sterling exchange rate. To add a tax increase that only applies to new cars, in such circumstances can only lead to the current result.”

VW ahead

Figures from the SIMI show March registrations were down 5.6 per cent on the same month last year, with 16,738 new cars sold. Of these, 4,586 were registered for the car hire market. In total, 9,519 new cars have been registered as hire cars so far this year.

Volkswagen is the most popular brand of new car to date, with 7,225 registrations, ahead of Hyundai with 6,676, Toyota with 5,929. Ford is in fourth place with 5,705, just 376 new car sales ahead of Skoda in fifth. At the premium end of the market Audi is in the lead with 2,428 sales, ahead of Mercedes-Benz with 1,869 and BMW with 1,834.

The Hyundai Tucson remains the most popular new car on the market, with 2,406 registrations.

At the commercial end of the market – regarded as a bellwether for general economic activity – sales of light commercial vehicles, mainly vans, are also down 10.7 per cent at 11,182 sales so far this year compared with the first three months of 2018, while sales of larger commercials, such as trucks, are down 3.3 per cent at 886 new registrations.