For two months in succession, new vehicle sales in New Zealand have dropped significantly compared with the same months last year.

In August, 5,684 new cars were registered, down 16.4% on August 2007, while new commercial vehicle sales were 22.8% down at 1,680.

The Motor Industry Association said no sector was immune from the economic pessimism that has prevailed during 2008.

"New vehicle sales defied economic trends for the first half of the year," said MIA CEO Perry Kerr, "but eventually there had to be an adjustment. The good news is that the indicators are suggesting that the bottom has been reached and that confidence will increase in the coming months.

"Our members are now predicting that the full year's new vehicle market will fall slightly short of 2007's level, but that the industry can move into 2008 with considerable confidence."

Toyota continued to prevail as the market's most popular brand with its Corolla establishing a year to date lead over GM Holden's Commodore as the country's top-selling model.