New Car Sales Stabilise, Business Tax Break Fuelling Purchases: FCAI

ACCORDING TO THE latest data released by VFACTS and the Federal Chamber of Automotive Industries,  Australian new car sales are on the verge of a recovery - and its largely thanks to general improvements in the economy and the recent boost in tax incentives for businesses.

The decline in new car sales is certainly slowing, with the total number of vehicles sold last month just 14.9 percent less than in May 2008. That's a definite improvement on April's figures, which showed overall sales to be 23.9 percent fewer than the same period last year.

In all, 75,439 vehicles were sold in Australia in May 2009, which is 11,474 more than April's result.

"The May figures provide a tangible indication that new vehicle sales have stabilised and indeed there are even grounds to suggest we may see signs of improvement in coming months," FCAI Chief Executive Andrew McKellar said in a statement issued today.

"There is clear evidence that the Federal Government’s business tax break is providing the market with a renewed sense of optimism and confidence.

"The business tax break is proving extremely effective, providing a much needed boost to vehicle sales and stimulating economic activity.

"Vehicle brands have been promoting this incentive heavily in recent few months and since the legislation has been passed there has been a perceptible increase in business sales."

Supporting the FCAI's view is the fact that business sales are faring better than other sectors, with business-related purchases down just 7.2 percent over May 2008.

To date, 352,374 new vehicles have been sold in Australia this year,with Toyota leading the pack with 15,481 cars sold, while Holden and Ford followed with 9177 and 8440 sales respectively.

Hyundai was the only maker in the top ten to gain any ground, sitting in fifth position with a year-to-date market share of 6.3 percent and current sales for 2009 at 22,073. All other manufacturers experienced a drop in sales.