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Sales of new cars slump as Northern Ireland consumers tighten belts

By Ryan McAleer

New car sales continue to decline in Northern Ireland with 10,000 fewer vehicles rolling out of showrooms in the first half of 2018 compared with a decade ago.

The Society of Motor Manufacturers and Traders (SMMT) said that 30,992 new cars were sold here in the past six months. It compares with 32,122 during the same period last year and almost 41,000 in the first half of 2007.

While the 3.5% sales decline in Northern Ireland is less pronounced than England, Scotland or Wales, it represents the weakest half year sales performance here in four years. The 5,501 cars sold in Northern Ireland last month was also the lowest June figure in six years.

The SMMT said the steady decline reflected continuing uncertainty in the new car market.

The Ford Focus was the bestselling new car in Northern Ireland in the first half of 2018. It was the only model to top 1,000 sales over the last six months, with the Volkswagen Golf following on 971 sales. Both Ford and Volkswagen had three models in the top ten, with Hyundai, Nissan, Kia and Vauxhall completing the list. Six of the top ten were SUVs, four were hatchbacks.

Across the UK, the SMMT recorded 1.3m new car sales in the first half of this year, 90,000 down on last year. But there was a dramatic contrast in fortunes between diesel and petrol engines. Diesel sales went from 613,985 to 428,612 over the period (30.2%), while petrol increased from 729,168 to 812,535 (11.4%). Alternative fuel vehicles were also up by 24.2% over the half year (45% up in June).

Ulster Bank's chief economist Richard Ramsey said the figures indicate low consumer confidence.

"While consumer behaviour is changing in response to the eventual phasing out of diesel cars, we are also seeing overall sales volumes continuing to follow a downward trend. This highlights a lack of consumer confidence which in turn reflects a squeeze on household incomes. In short, new car sales have been in a state of managed decline over the last two years, and this appears to be continuing.

"Local dealers have seen new car sales stagnate in 2015 and fall in both 2016 and 2017. This year is set to mark the third successive year of decline.

"However, it is important to point out that the headline sales volumes conceal contrasting fortunes between different brands and models. There are always winners and losers in all markets," Mr Ramsey added.

"Meanwhile, the average age of the cars on our roads is going up. The ageing of our car population is a sign of consumers continuing to tighten their belts."

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