Hungarian new car sales could fall nearly 50% this year, the chairman of the Hungarian Vehicle Importers’ Association (MGE) said on Wednesday.
“We expect the sale of (between 85,000 and 90,000) units this year, which would be an almost 50% fall,” MGE Chairman Gábor Győző told Reuters. He added that the forecast took into account the expected impact of fiscal austerity measures planned by Hungary’s new government.
Three months ago MGE projected the sale of 120,000 new cars this year, compared with 158,600 units in 2008. At that time analysts forecast an economic contraction of about 3.1% for this year, but their projections have risen to 5 to 6%. The slump in car sales reduces the tax revenue of the state budget and hits companies involved in car trade.
Hungary has been among the countries worst hit by the global crisis in central Europe as budget deficit cuts since 2006, following lavish state spending, contributed to a slowdown in economic growth to near zero in 2008.
In the Q1 of 2009, 27,229 new cars were sold, compared with 40,726 in the same period of last year, an annual fall of 33.1%, MGE said in a statement. (Reuters)