VFACTS New Car Sales: Market Still Down But Confidence Returning; Toyota In Top Spot

WHILE THE MARKET could not yet be described as buoyant, Australian new car sales for August 2009 have again held up against the odds, although down slightly against the same period last year.

VFACTS new car sales figures released by the Federal Chamber of Automotive Industries (FCAI) shows that 73,287 passenger cars, SUVs and commercial vehicles were sold in August 2009.

Increasing expectations of a recovery in the global economy, returning consumer confidence and the Rudd Government’s 50 percent tax concession for small businesses, have no doubt helped shore up sales.

Of most interest is that private and family buyers are now returning to the market. This, of course, will not have escaped the notice of the Federal Government nor of the Reserve Bank.

While August 2009 sales are down 5.2 percent against August 2008, the Lehman Brothers Bank collapse that sent the dominos falling through world financial markets did not occur until September 2008.

When compared to sales in 2008, which experienced three strong quarters before being hit in the fourth quarter, new car sales for 2009 have proven resilient.

For the eight months to the end of August 2009, 603,843 new vehicles have been sold, down 14.2 percent against the same period last year.

“(The VFACTS) figures indicate that private buyers are regaining confidence and re-entering the market,” FCAI Chief Executive Andrew McKellar said.

“The better than expected sales to private buyers and rental companies have really buoyed the market heading into spring,” he said.

Some segments of the market recorded increases in sales: SUV luxury, up 19.2 percent; commercial vans, up 8.2 percent; small cars, up 7.2 percent; SUV medium, up 1.6 percent; sports cars, up 1.4 percent and light cars improved marginally, up 0.3 percent.

Toyota remains in top spot for August with 15,994 vehicle sales, ahead of Holden with 9505 and Ford with 7623.

Will the market better the 880,000 sales forecast (that is, down 13 percent against 2008) that the industry was projecting for 2009?

Our guess is that the Australian market will likely nudge 900,000 units this year.

With returning consumer confidence, and an expected rush by small business buyers to take advantage of the stimulus tax concession before it expires December 31, the next quarter will show an improved position against 2008.

Next month’s VFACTS figures will tell the tale on that score.