Over the past year, new car sales have been one of the brightest areas of the Australian economy. In the year to March 2013, new car sales hit their highest ever level following a year of strong sales growth, particularly in the sports utility vehicle (SUV) segment (see next chart).
However, according to the Australian Bureau of Statistics (ABS), new car sales lost some momentum recently, experiencing three consecutive monthly declines to March 2013, although sales remained at high levels overall (see next chart).
Today, the AFR has published an article reporting that new car sales lost further momentum in April, with locally made passenger motor vehicles (particularly the Commodore) fairing the worst on the back of lower government spending, and SUVs still dominating sales:
Car sales, the last stronghold of the Australian economy, experienced a surprising wobble in April after months of setting fresh records.
Sales of new vehicles fell 12.6 per cent last month compared to March. April sales were also below 2012 levels, with 220 fewer vehicles rolling off the lot per selling day…
Sales of Australian-made cars continued their dramatic collapse.
Just 8500 Australian cars were sold in April, a decrease of 16 per cent compared to the same period in 2012, despite there being three more selling days in the month than last year.
Holden sales took the biggest hit, falling 24.5 per cent. Year-to-date sales of Holdens were 26 per cent lower than in April 2012.
A high Australian dollar and weaker government spending is hurting demand for locally made cars.
The single biggest contributor to the weakness in total vehicle sales was the government sector. In the first four months of 2012 it bought 17,000 vehicles, but in 2013 as purse strings tightened at state and federal level, the number was 12,500.
Even as the market as a whole has a weak moment, consumers are still buying SUVs. Sales in that category are up 12.6 per cent compared to 2012…
Light commercial vehicle sales also rose, by 17.6 per cent…
Sales of what the survey calls “passenger vehicles” fell 1.8 per cent compared to 2012…
The worst performing car in the segment was the Holden Commodore. Its sales fell from 10,600 in the first four months 2012 to 6500 in the same period this year.
The ABS new car sales figures for April will be released later in the month.
