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News - Market Insight - Market Insight 2021

Component shortages bite into sales

Losers: Cars and SUVs, especially popular mid-sizers like the Toyota RAV4, took a hit in October while the market found some strength in trucks and light commercials.

Analyst says October new-vehicle sales slide set to persist

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8 Nov 2021

THE vehicle market took a bit of a shudder in October, pulling back in comparison with the buoyant October of 2020.

 

But is it a lack of buyer interest or are the production holdups caused by the semiconductor shortages and supply-chain delays in transportation throttling supply?

 

Pitcher Partners Sydney partner Steven Bragg said that considering the global shortages in the car industry, it is no surprise that new-car sales deliveries are down for the Australian market. 

 

“In my discussions with dealers, the order-write (lead indicator) remains quite strong, which is good news,” Mr Bragg told GoAutoNews.

 

“I believe this will persist for some time until the OEM supply chains catch up, subsequently freeing up new car supply. 

 

“In the meantime, used car sales will remain strong, with prices elevated when compared with the long-term average.”

 

A closer look at the October 2021 data shows that though the month was down, the overall market on a year-to-date basis was stronger, up 22.7 per cent.

 

The combined sales of passenger cars, SUVs and light commercials were up 18 per cent compared with the same 10 month period in 2020.

 

Broken down further, cars and SUVs were up 16 per cent on 2020 for the same period. It was heavy trucks and light commercials that gave the YTD figures their strength, up 31.8 and 28.8 per cent respectively.

 

This indicates that the business economy involved in using trucks and LCVs remains strong, even outside any artificial spikes attributed to tax write-off incentives.

 

It was the sheer unavailability of cars and SUVs, and to a lesser extent LCVs, that clipped October’s result.

 

In SUVs for October, only the ‘light’ segment was up (by 20.4 per cent) while the other four sectors were down, with ‘upper large’ down 41.1 per cent and the most popular ‘medium’ category was down 31 per cent, hit by production delays and really took the brunt of the SUV market’s October retraction.

 

Australia’s most popular medium SUVs, the first-placed Toyota RAV4 and second-placed Mazda CX-5, recorded sales falls of 59.1 per cent and 63.5 per cent respectively. 

 

Other highly sought-after SUVs were also clipped, with the Subaru Forester down 61.9 per cent and the Kia Sportage down 45.7 per cent – though a new-generation model is imminent – while the Hyundai Tucson slipped a relatively mild 8.7 per cent for the month.

 

The same problems at the factories with component delays affected ‘upper large’ players, with the only two models priced under $100,000 – the Toyota LandCruiser and Nissan Patrol – clipped by 58.4 per cent and 17.2 per cent respectively.

 

Nissan allocated no Patrols for Australia in the month of October, so this will hit the model hard in the next few months.

 

Toyota has poor supply of its recently launched LandCruiser 300, again showing in its sales downturn.

 

Dealers say that both the Patrol and LandCruiser 300 have waiting lists for buyers at upwards of 12 months.

 

In the models priced more than $100,000, the soon-to-be-replaced Range Rover and Lexus LX were down 60 per cent and 67.6 per cent respectively in October, and the Land Rover Discovery was 35.3 per cent adrift.


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