Rising rates don’t dampen Australian new car sales

Despite continued pain at the bowser and interest rates that are on the rise, Australian motor vehicle sales are continuing to run at record levels according to official VFACTS figures released by the Federal Chamber of Automotive Industries (FCAI) today.

The Australian automotive industry has ended the first quarter of 2008 with total sales of 263,453 representing an increase of 8,385 sales or 3.3 percent over the same period in 2007. The magic million sales in a year mark is on target to be surpassed for the second time in history.

"We are yet to see any definitive effect on sales from the recent interest rate rises, although there was some evidence in March of fewer private buyers in the market," said FCAI Chief Executive Andrew McKellar.

Mr McKellar said consumers displayed a strong shift away from traditional passenger cars towards Sports Utility Vehicles (SUVs) during the first quarter of the year.

While the Passenger Motor Vehicle market was down 4,127 sales or 2.6 per cent year-to-date, SUV sales were up by 7,544 vehicles or 16.1 per cent.

"Consumers are being lured by considerable new model activity in the SUV market, greater availability of diesel engines and a general preference for the versatility and flexibility that these vehicles offer," said Mr McKellar.

The other major driver of the market so far this year has been Light Trucks, sales of which have grown by 3,952 or 9.5 per cent year-to-date.

"The Light Truck market was very strong in 2007 and continues to be buoyant in 2008 thanks to resilient demand from the business sector," said Andrew McKellar.

2008 could also be the year that the Holden Commodore loses its top selling Australian model crown, with the Toyota Corolla enjoying a 451 unit lead at the end of the first quarter. This may not sound like a lot but both of these models have been virtually neck to neck over the last couple of months, and the Commodore only just managed to take the podium in March with a narrow 20 unit margin over the Corolla. At the end of the first quarter, sales of the Corolla total 12,002 units with the Commodore trailing in second place with 11,551 units sold.

Toyota was the best selling brand at the end of the first quarter with 22.9 percent of the market, ahead of Holden with a 12.9 percent share and Ford with 10.0 percent.