VFACTS June 2010: Record-breaking Sales, But Some Missing Out

NEW CAR SALES JUNE 2010

So, a new vehicle market up 16.7 percent at the half-year mark, and on a trajectory to an all-time record high of 1.1 million sales… on those numbers, surely, everyone’s a winner.

Well, no. Not all manufacturers are on the same gravy train. You see, any brand, and any model, that is short of 16.7 percent growth, is losing market share.

And while it’s easy to get a cut of meat when there’s a feeding frenzy going on, when the market settles (and more about that in a moment) that loss of market share will really bite. What may surprise is who is losing out.

Let’s start with the main segments, we’ll take the top five in each: what’s up, what’s holding its own, and what’s on the slide.

In most segments, in terms of growth in market share, the story is all Korea. Hyundai and Kia are rampant.

With their extraordinary growth of the past 18 months continuing unabated, this too appears to be an embedded trend. And it will be scaring the crap out of everyone.

Light car segment

1. Hyundai Getz 2327 sales for June 2010 - up 25.5 percent YTD
2. Toyota Yaris 1866 sales - up 9.7 percent YTD
3. Kia Rio 1582 sales - up 15 percent YTD
4. Mazda2 1342 sales - up 6.6 percent YTD
5. Holden Barina 1245 sales - up 33.4 percent YTD

Of those, only the Getz and the Barina are really winning. The Rio is holding its own, but the Mazda2 and Yaris are losing market share.

And where’s Ford’s brilliant Fiesta? There is only one car its equal in that top five, the Mazda2, but with 981 sales for June it’s behind nearly everyone – even the Micra, Jazz and Swift are doing it over. Ford, where’s that DSG transmission? It’s time it got a decent auto.

Small Car Segment

1. Toyota Corolla 4194 sales for June 2010 - up 8.8 percent YTD
2. Mazda3 3680 sales - up 9.0 percent YTD
3. Hyundai i30 3209 sales - up 69.6 percent YTD
4. Holden Cruze 2987 sales - (up 999 percent, as a new entrant)
5. Mitsubishi Lancer 2538 sales - up 46.1 percent YTD

Just outside that list is Volkswagen’s Golf with 2527 sales, up 36.0 percent. 

Perhaps surprising is that sales growth of the Mazda3 (YTD) is below the market average. This is more a statistical anomaly than a case of "send for the doctor": the 3's performance this year is set against strong sales performance in 2009, when much of the market was struggling. YTD, it is in top spot for total sales in the segment - 19,835 sales against the Corolla's 19,127.  

In this segment however, the i30 is the story. If it maintains its current sales growth (17.0 percent growth for June) against current monthly volumes, it will move into second place within two months, and take top spot in three months. Double yowch for Mazda and Toyota.

Also notable is that the Impreza would appear to have stiffed. With 1045 sales, it is way down the list; worse, it is in negative growth with sales down 33.4 percent for the month, and down 8.4 percent YTD.

Medium Car Segment

1. Toyota Camry 2302 sales for June 2010 - up 35.0 percent YTD
2. Honda Accord Euro 732 sales - down 9.3 percent YTD
3. Mazda6 708 sales - down 4.0 percent YTD
4. Mercedes-Benz C-Class 674 sales - up 4.0 percent YTD
5. Subaru Liberty 551 sales - up 54.4 percent YTD

Interestingly, BMW’s 3 Series comes in at six, with 431 sales, beating the Mondeo into seventh, with 385 sales.

Also interesting is that the 3-Series was walloped by the C-Class on a monthly sales analysis. For June only, the 3-Series was down 41.3 percent, the C-Class up 18.9 percent.

Overall, the medium car segment continues to perform poorly. Its slide from favour would now appear to be an embedded trend.

Families have clearly lost interest in the medium car as a cost-effective solution to family motoring. And where have they gone? Into compact and medium SUVs – up 33.0 percent and 33.2 percent respectively.

Of the main players, it will be Ford Australia who will be scratching its chin hardest on this one. Its plans for the Mondeo in the local market, and especially for the wagon (replacing the Falcon wagon), may have to come in for a rethink. There is just no traction in this segment.

Large Car Segment

1. Holden Commodore 4697 sales for June 2010  - up 7.1 percent YTD
2. Ford Falcon 2651 sales - up 10.4 percent YTD
3. Toyota Aurion 1290 sales - down 7.4 percent YTD
4. Honda Accord 651 sales - down 30.1 percent YTD
5. Mercedes Benz E-Class 256 sales - up 83.1 percent YTD

Interesting here is the E-Class slipping into the top five in the large car segment, and the C-Class at number four in the medium segment.

If anyone - like, say, the Reserve Bank - was looking for signs that there might be some over-heated buyer exuberance behind the current record car sales figures, the performance of the three-pointed star would surely be one sign worth noting.

Also interesting is that the Holden Cruze has now passed the Falcon in total sales. We’ve been watching it closing on Falcon for a month a two – and this month it nudged ahead.

With local production of the Cruze soon to begin, this will surely be heartening for Holden. It is also evidence of yet another shift in the rapidly evolving Australian car market.

SUV Compact Segment

1. Subaru Forester 1690 sales for June 2010 - down 2.0 percent YTD
2. Toyota RAV4 1534 sales - up 12.3 percent YTD
3. Mitsubishi Outlander 1018 sales - up 33.0 percent YTD
4. Honda CR-V 1009 sales - up 26.1 percetn YTD
5. Nissan X-Trail 972 sales - up 20.7 percent YTD

Once again, just outside of that list, but closing fast is Wolfsburg. With 948 sales, and up 57.5 percent YTD, Volkswagen’s Tiguan is headed for a top five spot next month (especially with the Dualis – up 278.8 percent – surely eating into X-Trail’s sales in Nissan showrooms).

Also just outside, and clamoring for a place at the same table, is the CX7 with 889 sales and 160.3 percent growth YTD. Now with the option of a diesel under the bonnet, in coming months - on that sales growth - it is going to be elbowing someone aside.

SUV Medium Segment

1. Holden Captiva 1675 sales for June 2010 - up 25.5 percent YTD
2. Toyota Prado 1644 sales - up 44.1 percent YTD
3. Ford Territory 1320 sales - up 18.8 percent YTD
4. Toyota Kluger 1230 sales - up 8.9 percent YTD
5. Mitsubishi Pajero 804 sales - up 57.4 percent YTD

This month the Captiva has finally done it: it’s knocked the Prado off top spot. Interesting also that the ageing (but ageing gracefully) Territory is hanging onto its lead over the Kluger. Is the Kluger just too damn big for family buyers? The performance of the Captiva and Territory would suggest so.

SUV Large Segment

1. Toyota Landcruiser Wagon 780 sales for June 2010 - up 23.8 percent YTD
2. Mercedes Benz M-Class 331 sales - up 36.5 percent YTD
3. Nissan Patrol 320 sales - up 15.2 percent YTD
4. Land Rover Discovery 272 sales - up 41.2 percent YTD
5. Lexus RX 259 sales - down 2.8 percent YTD

So, on these numbers, it might be inferred that everything is well with consumer sentiment and, ipso facto, the Australian economy. Yes, bumper June sales, thanks to all the discounting that goes with that ‘EOFIS’ thing, has 2010 looking very healthy indeed.

And therein lies the problem. The Reserve Bank Governor, Glenn Stevens, will also be looking at those figures and wondering what to make of them.

But, with the Chinese economy slowing, and indications from Europe that a ‘double-dip’ recession is on the cards, Mr Stevens has clearly chosen to hold a watching brief and is keeping his hand off the interest rate trigger... for the moment at least.

But a warming economy, or any signs of buyer exuberance - such as these vehicle sales figures indicate - will inevitably result in a lift in interest rates down the track.

So it’s too early to make the call on a record year. Especially as business sales are still lagging.

With clouds now hovering over the recovery in the world economy, and some real warning signs emerging, what happens in the next two or three months will be interesting indeed.

- Tim O’Brien