New car sales in Hungary dropped in the first quarter of 2008 and the car importers’ association has lowered its full year outlook.
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New car sales fell by 4.1% to 40,673 units and full year sales are seen at 170,000 units, down from an earlier estimate of 175,000 cars, Gabor Gyozo, acting chairman of the MGE car importer association, said.
“Households have no money,” Gyozo told Reuters. “Income levels are still falling and people dip into their savings to finance day to day living, not to finance investments.”
Reuters noted that real wages in Hungary fell by 4.8% in all of 2007 due to government tax and price hikes. Falling real wages are said to be continuing this year.
“We’re not seeing any such increase, we’re seeing no improvement of any sort,” Gyozo said.
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By GlobalDataHe added that households are also becoming more reluctant to take out loans to finance car purchases.
“The only positive sign is that purchases by corporations are flat and not falling,” Gyozo told Reuters.
