July car sales declined by 13.2 per cent from the same month last year, thanks to weak consumer confidence, the World Cup and the end of the previous government's car scrappage scheme, the Retail Motor Industry has said.
The RMI said that scrappage scheme had given a strong boost to sales last July, thus making for tough comparatives this year.
Despite the end of the scheme manufacturers have been putting into place their own industry incentives to promote sales, such as "swappage schemes", which have helped to promote recovery in the industry.
Sue Robinson, Director of the RMI, said, "The consumer market in particular bears the brunt, with the pressure of job uncertainty and the prospect of shrinking household incomes as Government proceed with nationwide spending cuts, doubtlessly reflected in reduced spending ."
"This uncertainty amongst consumers, combined with summer holidays, the World Cup, and a desire to wait for the new 60 registration plate in September, has translated, in the current market, to decreased footfall in showrooms and, consequently, impacted on sales for the month."
"In order for the market to strengthen manufactures need to support dealers and consumers alike, with assurances that vehicle prices will remain competitive, and by offering attractive, enticing, sales incentives, and that availability of the popular consumer vehicles is optimised to ensure consumers aren't deterred by long waits for their vehicles.
"The Government needs to address the fragility of the market by reassuring consumers about tax rises and spending cuts. July is traditionally a quiet month in the show room, with buyers away on holiday and waiting for 60 plates, but with the right manufacturer incentives and assurance from Government, the market will strengthen again over the coming months, with the added desire by consumers to beat the VAT increase."