Economist: Car sales in Northern Ireland have plunged and will only get worse during this lockdown

It is worth remembering that the Northern Ireland economy and consumer spending / confidence were not in a good place before the Covid-19 virus struck.

New car sales have been flat or falling for the last five years.

According to the data from the Society of Motor Manufacturers and Traders Ltd (SMMT), local dealers also posted their worst January and February new car sales figures in at least 25 years.

So 2020 was already going nowhere fast as far as new car sales were concerned.

However, the pandemic has accelerated this decline to a pace not witnessed in Northern Ireland previously.

The government lockdown has seen many sectors impacted including car dealers.

Local dealers posted a 56% year on year decline in March which compares with a 44% decline for the UK as a whole.

As a result, the first quarter of this year marks the lowest level of new car sales since the last quarter of 2008.

Taking the last twelve months of sales, Northern Ireland dealers have sold 46,533 new cars.

This is already lower than the car sales trough in the last recession (46,794 in the 12-months to April 2012).

April will undoubtedly see even greater declines with the lockdown expected to be in force for the entire month and beyond.

We can get an idea of the scale of declines under a full lockdown by looking at France and Italy.

The latter introduced its lockdown on March 9 with new car sales plunging 85% year on year last month.

France’s lockdown came later than Italy’s and its motor industry recorded a 72% year on year decline in new car sales in March.

All economies, Northern Ireland included, will do well to record any sales whatsoever in April.

Other sectors such as the hospitality industry have witnessed similar declines in sales activity with deeper falls to come in April and beyond.

• Richard Ramsey is chief economist for the Ulster Bank in Northern Ireland