New car registrations rose by nearly a quarter (23%) to 101,335 in the first six months of the year when compared with 2015 figures, according to data from the latest SIMI/DoneDeal industry review.
Although a drop-off in sales is expected for the remainder of the year, the report states new car sales should exceed 150,000 for 2016.
Meanwhile, car sales contributed €978m to the Exchequer in the second quarter - a rise of 28.5% on the same period in 2015.
According to the data, '162' new car registrations for the first 20 days of July were 11% higher than this time last year - rising to 21,525.
The strongest growth in sales between April and June was seen in Roscommon (+37.9%), while Leitrim experienced the lowest level of growth (+14.5%).
Commenting on the contents of the SIMI/DoneDeal Report, economist and author Jim Power said: "Despite the still-positive economic outlook, growth in car sales could be low or maybe even flat in 2017.
"This slowdown in growth reflects a market approaching, but still lower, than its natural state, after a prolonged period of catch up, but one that is now shrouded in Brexit uncertainty."
However, some positives highlighted in the report include a fall in fuel prices, with petrol falling 8.4% in the year so far, while diesel is 12.4% cheaper.
To counter this though, insurance costs have rocketed by 38.6%.