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Drop in car sales in Northern Ireland points to slower recovery of economyBack

SMMTSales of new cars in Northern Ireland have suffered a year-on-year drop, despite the number of vehicles sold in the UK as a whole rising to a record 1.3m.

Data released by the Society of Motor Manufacturers and Traders (SMMT) shows that sales here fell by 0.59% in the first six months of the year, but the number of new vehicles sold in the UK as a whole rose by 7%.

The SMMT report also revealed that 33,409 new cars were registered in Northern Ireland between January and June 2015, with the Ford Fiesta (right) continuing to top the list of most cars sold.

Sales were more buoyant in the month of June – up almost 5% on the same period in 2014.

And around one in six buyers chose a UK-manufactured vehicle – the highest level in five years.

Ulster Bank chief economist Richard Ramsey said that “the fact that new car sales have been much stronger elsewhere indicates that the economic recovery in Northern Ireland is not as robust as in the rest of the UK.

He added: “The figures actually show an improvement for the months of May and June and the poor performance actually only relates to the first four months of the year.

“However, looking ahead to Wednesday’s budget, a rise in fuel duty and the cost of petrol could further dent consumer confidence.”

And economist John Simpson said new car sales continued to be a “good indication of how families feel about the security and strength of household incomes”.

He said: “There are strands of evidence that Northern Ireland is not keeping pace with the changes in Great Britain.

“Across the UK, real household incomes have been improving slowly and there is some better confidence that the better outcomes can continue.

“The slower recovery in employment numbers and incomes is something of a surprise following the recent good results published by Invest NI.

“Nevertheless, household confidence in job security and higher real incomes has been threatened by a degree of caution following, in particular, the instability stemming from the continuing uncertainty on the future of the Northern Ireland Executive as a result of failure to agree a stable budget.

“In addition, job security and prospects in the public sector have been shaken by the need to find a large number of people who may lose their jobs if the voluntary leaving programme is implemented.

“In turn, these uncertainties are affecting the private sector, particularly with a pause in the increasing workload for the construction industry and the postponement by government of all avoidable non-contractual commitments.

“Northern Ireland does not readily compare at present with the changes in the Great Britain economy.”

Posted by Sue Robinson on 10/07/2015