The motor vehicle market has dropped by between 20 and 30 percent as the economic downturn continues take its toll on automotive dealers in Bermuda.

That is according to Jonathan Brewin, president and CEO of HWP and chairman of Bermuda Automobile Distributors Association, who said that the automotive trade had been hit harder than most other sectors over the past year and added that market volatility was the biggest concern for the majority of traders.

But he was upbeat about the chances of the market making a recovery, albeit it may take longer than in some other countries.

"Essentially we have been noting a steady decline in sales in the market for probably a longer period than other industries," he said. "I think we were first seeing the decline in May to June of last year."

Mr. Brewin said one of the issues on the top of many auto dealers' lists was having enough working capital in the face of an extremely volatile market.

But, above all, he said the industry as a whole had to focus on offering the best value for money to its customers during these tough economic times.

"Quite understandably all our clients are expecting better value for their dollar, so therefore there have been much higher expectations than we have seen before," he said.

"But the industry is doing its best to meet those very realistically."

Another worrying trend seen by Mr. Brewin was a decline in motorists getting their vehicles properly serviced, adding that his company has always been committed to helping customers take care of their automobiles.

However, he does see some reason for optimism through all the doom and gloom, which has seen the motor vehicle sector suffering its third consecutive month of falling sales. Dealers reported six percent lower sales revenue in July 2009 compared to a drop of two percent during the same period in 2008, due to weak consumer demand for vehicle models, as per the Department of Statistics' Retail Sales Index.

"What goes down has to come back up again, but I think the timing is really the $64,000 question," he said.

"I don't see it happening in the short term, but I think we are going to see some worsening before it gets better with a time lag between what is happening in the US and Bermuda."

Mr. Brewin said his workforce has been reduced by 15 percent through "natural attrition" and the firm was constantly reviewing the situation in light of the market volatility to keep overheads down.

Hardest hit were HWP's automotive, appliance and cycle department sales, said Mr. Brewin, who added that he couldn't think of any area where there had been growth in recent months.

"There is also a greater push for people to get smaller, more economical vehicles with a particular focus on registration and licensing costs," he said.