Car sales drop again in April
May 5, 2009 by David Twomey
New vehicles sales in Australia officially dropped 23.9 per cent in April continuing a trend of recent months, but car companies are starting to become more confident that the market will turn around in the next few months
Official VFACTS data released by the Federal Chamber of Automotive Industries (FCAI) shows that 63,965 passenger cars, SUVs and commercial vehicles were sold in April, down 23.9 per cent or 20,096 vehicles, compared to the same month in 2008.
“While the figures confirm that market conditions remain soft, the extent of the fall has been compounded by the timing of the Easter holidays,” FCAI Chief Executive Andrew McKellar said.
Year-to-date 276,935 new vehicles have been sold, down 20.3 per cent compared to the same period last year.
“After adjusting for seasonal factors, sales in April appear to be broadly consistent with results of recent months and we remain hopeful that conditions will soon stabilise,” Mr McKellar said.
The automotive industry will continue to promote the opportunities that exist in the next two months for businesses to take advantage of the Federal Government’s enhanced tax break for new vehicle purchases.
“There are signs of increased buyer interest in, and awareness of, the incentive programme, which certainly underpins the need for speedy passage of the legislation,” Mr McKellar said.
Toyota was Australia’s best-selling brand in April with 13,033 vehicles, followed by Holden with 7829 and Ford with 6836 vehicle sales.
Toyota, with a market share of 20.7 per cent, holds market leadership in year-to-date terms. Holden’s April result sees it in second position with a market share of 12.6 per cent, with Ford’s market share of 10.0 per cent placing it third.
Mazda, with sales of 5121 and with a market share of 8.7 per cent, hold fourth position. Hyundai, the only company in the top 10 to show a sales growth, achieved 4136 vehicle sales in April and with a share of 6.1 per cent, is in fifth place ahead of Nissan, on 5.9 per cent market share
Print it: 
The significant less supply coming onto the market should help to restore depreciation levels to more normal levels than what has been the case over the past few years.
The 24% drop in new car sales is not enough to see Australia introduce vehicle a scrappage scheme like what has been introduced to U.S, Germany and Britain.
The government should however continue and extend the tax break scheme for another 12 months.
This “Mckeller” is the biggest Sherlock out there.
I dont think i have ever read one insightfuill bit of script come from his direction.
does he forget that we had an easter break last year too???
what is there to adjust for???
there is no need to make adjustments for seasons, just compare this year to last like you priginally did they be quiet, enough said.
dont try hard to justify you job by complicating it
love to know the increase in commercial sales due to the 30% allowance (to be?)by the gov’t.would make car sales worse i reckon…
I sell light commercial utes, and the increase in sales for small business sales has been pretty huge over the last month, the only thing I am concerned about is that all these businesses pushing their purchases forward will probably bring a massive slowdown come 3-4 months down the track.
Luke: Depreciation in Australia is nowhere near enough. Buying a 10 year old bomb you still pay 50% of the new car cost – show me any other country in the world that values their second hand vehicles the way car owners in Oz do. Second hand is overpriced – no other way to say it. With less demand, and less supply I do not think depreciation will “improve” – buying a car has never been a financially smart decision for 90% of people, its a shame some people expect to use a car for a period of 3-5-10 years and still get a premium price.
I don’t understand how Easter Break would affect things. Easter is on a Sunday, when most dealers are closed anyway.
PS – love the stock photo at the top. Clearly not Australia.
I didn’t think that it would have to be said, but here goes then:
Easter was in MARCH last year, that means less trading days for April this year. Sheesh!
Jeckyl,
I get your point, but the “30% allowance” will also apply to passenger vehicles.
removing the commercial element wont really paint any worse of a picture for the passenger segment.
Mark,
thats my thoughts on not only the 30% incentive, but also the scrappage scheme.
it will only bring tomorrows sales forward to today.
What ever happended to dealing with life rather than sugar coating it.
The worlds economy is simply experiencing withdrawls from the massive high it was on.
After a while it will sort itself out, the longer we try to deny or falsify figures, the longer it will take to get back to reality
Toyota down 37%
Camry/Aurion down about 50%
Holden down 23%
Commodore down 5%
Ford down 17%
Falcon UP 20%
Mazda & Nissan down 24%
Hyundai UP 12% for the year so far.
Bret i realise that, but its still irrelevant to a certain extent when relating excuses to figures
If we stay on the march subject, why doesnt he then paint this years march figures as being even worse??
Andrew, I seem to recall an admission that March’s figures included extra trading days over last year?
From an article at drive;
“Car sales have slumped by almost 20 per cent in the first quarter of this year but government purchases of the Commodore have increased by 8 per cent, keeping the home-grown hero on top of the sales ladder.
By contrast, state and federal government purchases of Australia’s only locally-built four-cylinder car, the Toyota Camry, are down by 16 per cent.”
What the hell is going on?
Falcon sales are up 24% and Ford continues to close the gap to Holden. Toyota still with a commanding lead, but much reduced market share.
More advertising of Falcon’s 9.9L economy will help!
In case anyone was wanting clear concise balanced and unbiased viewpoints on motoring, the fact Drive declares Commodore as “the homegrown hero” shows you won’t get it from them.
Bret,
perhaps i shot off not thinking someone would chime up shooting back with tecnicallities.
I just get sick of excuses as to why sales are down.
trying to fudge them by claiming an extra trading day here and there.
The bottom line is there are still “X” amount of sales to be had.
If they cant occur on a certain day for whatever reason, they will occur near by, be it the weekend before or after for eg
April was down in line with the yearly average, its as simple as that, why would one waste their time complicating the facts……..
Phil C,
I havent seen the new falcon adverts yet, I say about time they had a dig at the other manufacturers that have had a dig at ford in the past.
Ford will also close the gap further to Holden once Holdens 2nd highest selling item the Astra has its stock cleared from the floor.
I wouldnt mond guessing that Ford is the top selling Aussie product though.
Falcon sales arent far behind the commy and the falcon ute sales are on top of the holden equivalent, but im not sure what the Terry is running at at the moment……
Would be line ball I guess
Bret,
This wood duck will write war and piece about technicalities but the truth is this, you are right and he is a woodie.
Car Sales drop again in April and Honda increases price again in May.
Focus sales slumped 62% in April, so much for Ford’s advantage over Astra’s loss…
Don’t forget the Cruze is just around the corner which on price alone will sell up a storm, and most likely more than Astra and Viva combined.
The Korean brands are selling up a storm…..
Give it another 12 months and then you will see which cars will be at number 1, 2, 3. Next 12 months will test these companys of how to really survive in this recession. Only the smart ones will continue selling while the others will fade away.
Focus would be in transition from old to new…
Jason Smith Says:
May 5th, 2009 at 6:31 pm
I don’t understand how Easter Break would affect things. Easter is on a Sunday, when most dealers are closed anyway.
Yeah, no tading on Sunday, no trading on Good Friday and no trading on Easter Monday!
Three days less trading for the month of April.
Oh don’t forget ANZAC day! Make that 4 days.
Does anybody know how the second hand market is going?
I heard that dealers are having trouble finding good stock.
Frenchie Says:
May 5th, 2009 at 10:24 pm
Yeah, no tading on Sunday, no trading on Good Friday and no trading on Easter Monday!
Well, I was away (overseas) during Easter this year, and where I was, in the US, Good Friday is considered a normal trading day. Easter Monday is not even recognized there.
@ Frenchie
detailed article on used car market here (hope CA doesn’t mind the link)
http://www.goauto.com.au/mello.....A900285675
@ Jester – Here’s some figures from the UK.
“Year to date, the annual depreciation rate decreased from 34.9 per cent to 30.4 per cent on all 36-month-old cars in the UK, and from 29.6 per cent to 24.1 per cent for all 12-month-old cars.”
Thanks Luke.
From what I can make of the story fleets are hanging onto their vehicles longer creating demand in the secondhand market. I bet when they sell, they will want to cash in on the demand there at a latter date no doubt.
Jason Smith:
Thats why people love Australia mate, the long weekend!
Frenchie:
Thats why people love Australia mate, the long weekend!
Do they also love paying an average of half a million dollar for a house in a capital city? When in the US, you can buy a house for $25,000?
Maybe people pay $475,000 more to live in a nicer country Jason?
“ROFLmatic” – don’t bring opinion into this. I’m stating facts.
Australian cars and houses “premiumly” priced in comaparison to other westernized nations?
No shock there.
Roflmatic..
Having access to cheaper food.
Access to a much more varied media of entertainment..
Having access to cheaper home.. cars.. things..
Canada, USA isnt too shabby to live in in comparison to Australia. I lived there long enough.. dont get me wrong Australia, Melbourne has its charms, love this city but, USA/Canada are very very nice to live in also. crime sucks and a lot of arrogant people but still nice depending where you are situated.
Fear seems to be the biggest factor in market direction. First fuel prices went up; at one point official reports were telling us to expect to pay up to $2.00 a liter by Christmas 2008, as we know it got close but dropped significantly back before Christmas. Along with rising interest rates this delayed most private and domestic car buyer’s decisions to replace any stock. This had several effects to the market, six cylinder cars became less desirable due to running costs and whole sale values dropped. Four cylinder cars increased in sales. Because less people were trading in for new cars, used car dealers found stock very difficult to come by. But the market adjusted as people became used paying more for fuel and higher interest. Next blow to car sales is of course the global credit crisis and retreat of GMAC and GE again putting the fear of the unknown into the industry and forcing a national slow down. My point is every time the market changes it adjusts and recovers. I remember when GST was first introduced, consumers did not understand it and therefore feared it, sales slowed for several months after but soon recovered. Car sales are among the first to benefit or suffer from economic shifts and need to adapt quickly to changing market trends in order to remain profitable. It makes sence dealers are expecting the market to recover over the next few months because we have seen this trend so many times before. Just looking at my personal sales since December 2008 each month has seen an increase on the month before.
max Says:
May 5th, 2009 at 6:59 pm
From an article at drive;
“… government purchases of the Commodore have increased by 8 per cent, …. By contrast, state and federal government purchases of Australia’s only locally-built four-cylinder car, the Toyota Camry, are down by 16 per cent.
What the hell is going on?”
Max,
Most of those numbers are infact th SA Govt supporting it’s local manufacturing industry. A very significant order for Focus, Corolla and Astra was cancelled in favour of the locally built (for SA) product.
All of the Commodores ordered to replace the 380’s are LPG (duel fuel). A duel fuel Commodore is cheaper to run than a Camry.
Sorry, forgot to add that the reason for the poor govt. sales of Australia’s only locally built 4 cyl car (Camry) is because it is such a poor performer economy wise. Fleets just find them too expensive to run, and prefer the smaller, imported cars if it has to be a 4 cyl car.
When I was in the US, I saw brand-new 2009 Mazda3s advertised for $99 per month. Not per week, but per MONTH! That’s about $1200 a year (or $1700 Australian). Why on earth would you BUY a car when you can rent (i.e. lease) for less than the cost of depreciation each year? If you looked at the cost of doing the same here in Australia, it would probably cost $5,000+ per year for the Mazda3 – 3 times the price. I also saw Lexus IS250s for $250/month ($58/week!).
Jason Smith
Off topic but just curious, could you post a link of that $25000 house, and let us know where it is?
Cheers
Millatime – it’s not just 1 house that’s $25,000… there are a ton of houses for that price, all over the US. You just have to be willing to settle for an older style home (from the 20s thru to the 50s, for example). Not that there’s anything wrong with that – it’s probably no worse than a house in Melbourne from that era (which would sell for 10-20 times as much). Doesn’t seem to be letting me post a URL :(
Jason, keep in mind the US has far larger buying power than Australia. You only need to look at new car prices in the US compared to the equivlent models sold in Australia. I lease my company car and totally agree that ownership of a car is financially pointless.
Millatime, ACA did an episode of an Aussie bloke buying up foreclosure homes in Detroit. The prices are shocking, just check some of these out:-
http://www.bankforeclosuressal.....troit.html
What the hell are Honda smoking! They put up prices yet again across the whole range.
Car sales continue to fall yet some manufacturers think it’s ok to put prices up in this climate?
Can’t they say that in times like this price is number 1 for the majority of buyers? All they have to do is look at Hyundai to see how much price matters right now.
You failed Honda.
Watch Hondas sales plummet. The Jazz and City are both overpriced for cars coming from Thailand. The CR-V is overpriced, underpowered, and ugly. The new Accord and Accord Euro are both bland (and underpowered in 4-cylinder form). I have only ever owned Hondas – my first car was a CR-V, and 3 years later, I bought another. However, I’m going to be looking to another brand for my next.
Well the low US house prices are partly a result of the homeowners handing back keys to the bank and walking away.
I’d also be watching the fine print on the $99/month car loans.
Watch for a massive balloon at the end.
Andrew – it’s a lease – there’s no payment at the end. You hand the car back and get a new one. I did read the fine print and it did say that $3500 was due up front (which works out to nearly 25% of the car’s cost). However, on the Lexus lease the up-front payment was only $1500.
Fair enough then, thanks for that.
How long were they asking you to lease tham for???
Oh and doesnt that make the car only worth about $14K???
As I mentioned, this is something I saw in the US. The Mazda3 sells for about US$15,000 there.
Fair enough Jason, thanks.
If they are only 15K to buy out right, and if mazda resale is anything like it is here, you would still be better off buying out right me thinks.
I suppose the down side to having cheap cars and houses is not having any money to buy them.
No matter what the market, prices will be relative to wages
As for house prices, i think I know why they are so cheap…..
I saw on the news that they are bulldozing brand spanking $400K houses because they just cant sell them.
If you were gonna invest in their property I would say one would have to be prepared to sit on them for a while as i couldnt see their prices recovering any time soon.
But hey, with prices that low, you could probably afford to…..
why do people who drive CRVs actually read websites about cars?
I’m confused so why do car sales fall in the month of april every year?? is it really due to the fact that there are less trading days or something totally different. I know that sale increease in June each year due to the end of financial year sales but dont really understand why they slump in april and january. Cheers