The euro’s steady rise against sterling is boosting demand for car imports from the UK, according to Fexco Corporate Payments.

The financial services firm says that Irish car dealers increased their spending on vehicles imported from the UK by 20% during the first half of 2018 compared with the same time in 2017.

Fexco analysed 3,000 transactions made by its currency dealers on behalf of Irish individuals, car dealers and garages between January and June 2018, then compared the data with the same period in 2017.

Spending on UK imports by Irish car dealers and individual car buyers together rose by 14% in H1 2018 compared with the first half of 2017.

When compared with the levels recorded in the first half of 2016 – before the UK’s vote to the leave the EU – the combined spend of individual motorists and Irish car dealers is up by two-thirds.

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Fexco also recorded a 49% increase in the number of cross-border car purchases made by dealers and motorists between H1 2016 and the first half of 2018.

The Fexco data mirrors official statistics compiled by the Society of the Irish Motor Industry. In H1 2018, it registered nearly 50,000 used cars imported from the UK, a 12% increase on the same period in 2017 and a 64% increase on 2016.

The SIMI data also suggests Ireland is on track to import 100,000 used cars from the UK for the first time ever this year. It predicts that used car imports will rise by 15% in 2018, with new car registrations falling 8.6% on 2017 levels.

David Lamb, head of dealing at Fexco Corporate Payments, commented: “The UK has a much greater supply of used cars than Ireland, so all things being equal a British used car should cost less than a similar model on this side of the Irish Sea.

“Historically the cost and red tape of importing a UK-registered car into Ireland put off all but professional dealers or the most committed individual motorists. But sterling’s continued weakness has shifted that calculus, and is nudging ever more Irish car buyers to look to the UK for their next car.

“With the UK widely expected to raise interest rates in August, sterling could strengthen in coming weeks,  meaning Irish buyers planning to import a car from the UK may want to lock in the current favourable exchange rate by using a forward contract.”