The body which represents the motor industry has called for a rescue package for the sector after new figures showed a sharp drop in sales in January.
The Society of the Irish Motor Industry (SIMI) said the number of new vehicles registered in January was 15,929, a drop of almost 67% from January last year.
The SIMI claimed the introduction of changes to VRT and Road Tax in July last year and the announcement of an early Budget stalled the market, and there had been no recovery since.
The body said tax revenue from the car industry could fall by two-thirds to €500m this year unless the Government took action.
SIMI said that, though demand for used cars was encouraging, a fall in oil prices and interest rates had been of 'little assistance'. It said the industry had already suffered 3,000 redundancies and big cuts in salaries.
SIMI is calling for a rescue package, which would include a new scrappage scheme, a review of the VAT system for car dealers, a crackdown on avoidance of taxes on imported cars and help from banks and lending institutions.
