Car shortage in Northern Ireland Looms as Windsor frame forces EU car standards
Northern Ireland is facing the prospect of a shortage of new cars and higher car taxes as post-brexit provisions under the Windsor framework come into force in early 2026, causing concern for the car sector.
From January 1, all new cars sold and registered in Northern Ireland will have to comply with European vehicle standards rather than those used in Great Britain. Dealers warn that many of the British models that will currently be sold in Northern Ireland will no longer be suitable, creating the risk of significant gaps in showroom availability and, in some cases, the complete withdrawal of certain models.
EU car regulations generally require additional safety features, such as appropriate speed limit warnings and Speede-Wheel Lane-Aid Systems, which are not standard on all UK market cars. Manufacturers have been slow to adapt British models to meet EU requirements, leaving Northern Ireland retailers exposed just weeks before the rules come into effect.
The changes will also affect company car drivers. Tax concessions for all types of vehicles registered in Northern Ireland will be calculated under EU rules, plug-in Hybrid Cars will attract higher tax credits than similar vehicles registered elsewhere in the UK. Industry figures say this deviation risks distorting purchasing decisions and making Ireland an attractive base for employers.
This situation is further exacerbated by the widening gap between the UK and the EU in the transition away from petrol and diesel vehicles. The UK plans to ban new petrol and diesel sales from 2030, while the EU ban was originally planned for 2035. That limit now appears to have been pushed back to 2040, possibly selling a gap in vehicle availability and compatibility.
The Windsor framework, agreed to avoid a hard border on the island of Ireland, keeps Northern Ireland in line with the EU’s single market for goods. While this was done to protect Friday’s sweet deal, it has had a very sharp impact on motor vehicles, leading to similar British vehicles being found in England, Scotland and Wales.
The top figures in the car industry have held many meetings with the secretary, Hilary Benn, pressing the endless delay in the implementation of the EU car standards and the generous tax benefit to be in line with the rest of the UK. While Ministers are said to be sympathetic, officials have indicated that any changes would need to be part of a wider reset in wider economic relations.
Whitehall sources insist that the Government remains committed to “the full and faithful implementation of the Windsor framework”, arguing that it protects the unique position of Northern Ireland and ensures a smooth flow.
The stakes are high. The automotive sector employs approximately 17,600 people in Northern Ireland and returns approximately 50,000 vehicle registrations each year, approximately 2.5 per cent of the UK market. Dealers say that cars from the Republic of Ireland are not a viable alternative, because prices tend to be higher due to the car registration tax and a percentage of 23 percent, compared to 20 percent in the UK.
Despite the framework’s aim to maintain the EU’s internal market, there is little cross-border trade in new cars. Just 134 vehicles were imported into the Republic of Ireland in the ten months to October 2025, including just six from the UK, highlighting the practical limitations of Ireland’s supply dependency.
Marketers are already feeling the effects. Manufacturers have decided to tap into UK stock pipelines, and while new car sales across the country are up five per cent so far this year, registrations in Northern Ireland are down three per cent.
A government spokesperson said ministers are working to ensure that manufacturers face “the aim of getting drivers and sellers in Northern Ireland from a limited perspective. However, with the deadline fast approaching, industry leaders are warning that without swift action, shortages and higher costs are inevitable.
