News - Market Insight - Market Insight 2011

Ute prices unloaded as run-outs ramp up

Flying: Substantial price-cuts, more advertising and revised stock issues have seen the Ford Ranger's sales boosted by 60 per cent in the first two months of this year.

Toyota’s HiLux loses traction as rivals discount prices ahead of new models

Market Insight logo28 Mar 2011


DISCOUNTS of up to $10,000 on workhorse utes are reshaping the Australian light truck market as importers of the mainly Thai-built one-tonners position themselves for a wave of new models.

Some of the most popular dual-cab diesel four-wheel-drive utes that have a theoretical price in the mid-$40,000 range, plus on-road costs, have been slashed to the mid-$30,000s – driveaway.

Ford, Holden, Mitsubishi, Mazda and Nissan are among the companies to trim prices with an axe as they either run out ageing models ahead of all-new vehicles due later this year or try to match the cut-throat prices offered by others.

Fearful of repercussions on its much prized resale values and trusting in its unrivalled reputation in the ute arena, market leader Toyota has so far resisted the temptation to go blow-for-blow with its rivals, but is advertising $3500 discounts across the range for its top-selling HiLux 4x4s.

And, while it has an updated HiLux due for release mid-year, Toyota appears to be keeping its powder dry on run-out activity, at least for now.

However, HiLux sales so far this year are suffering the consequences of rival price cuts, slipping 14 per cent, with the biggest hit taken by HiLux 4x2 models, sales of which are down 20.3 per cent.

Caution should be taken when comparing sales in the first two months of 2011 with the same period last year, as the market was distorted in early 2010 by the hangover from business tax incentives offered by the federal government to the end of 2009.

128 center imageFrom top: Upcoming all-new Ford Ranger, Holden Colorado, Toyota Hilux SR5, Nissan Navara D22, Isuzu D-Max.

This year, the evergreen HiLux is still king of the heap by a wide margin, with 5383 sales in 2011 compared with second-placed Nissan Navara’s 4011 sales, so no panic buttons are being hit yet.

However, the alarm bells must be ringing as sales of vehicles such as the Ford Ranger soar under blunt-instrument marketing tactics that include a $37,590 driveaway price on its one-tonner of choice, the 4x4 XLT Crew Cab diesel – an effective cut of more than $9000. And that’s on 2011-plated vehicles, too.

Ford Australia says price is not the whole story to the sales spike, as it was suffering stock restrictions last year – a situation that has been remedied this year.

As any television viewer can attest, Ford has ramped up advertising of Ranger and other models to stem a general sales slide by the Blue Oval brand.

In the first two months of this year, Ranger sales are up 60 per cent, with 4x4 volumes up a staggering 102 per cent thanks to the XLT offer that has clearly tickled the fancy of tradies and others who love a bargain and who do not seem fazed that an all-new model is due in about six months.

Although Holden’s next-generation Colorado is a bit further out, Holden has also pulled out the scalpel to cut about $10,000 from prices of some of its most popular model variants, with the diesel crew cab 4x4 LT-R going for $38,990 driveaway, instead of $48,690 plus on-roads.

Holden’s hand has been somewhat forced by a 21.5 per cent slump in Colorado sales in the first two months of this year – a dive that has placed the Colorado (nee Rodeo) behind the rival Ranger in the sales race for the first time.

That situation is being compounded by a 26.5 per cent fall in sales of its locally made Holden Ute, which has dipped below 1000 units a month.

Mitsubishi and Nissan also have been riding the discount wave, with Mitsubishi knocking more than $8000 off its award-winning Triton 4x4 GL-R diesel, which is now down to $36,990 driveaway, while a 4x2 petrol cab-chassis GL is on offer for $19,990 driveaway. Triton sales are consequently up 5.1 per cent.

At Nissan, its old-school D22 Navara 4x4 ST-R dual cab is whistling out of showrooms at just $30,888 driveaway, helping to drive Navara sales up 27.4 per cent this year.

Mazda, whose current BT-50 is effectively in run-out along with its sister model, the Ford Ranger, is also reaching for the discount-price weapon as a last hurrah before the arrival of the new T6-based model in the second half of the year.

A diesel-powered 4x2 DX cab-chassis – with aluminium tray and other extras thrown in – is on offer for $21,990 driveaway. So far in 2011, BT-50 sales are up some 32.6 per cent.

That rise is trumped by Isuzu’s D-Max, sales of which are up 35.3 per cent, although from a smaller base.

Izuzu’s long-awaited all-new model is waiting in the wings, along with the related Holden Colorado, although the differences will be more significant this time around. Isuzu is not saying when its version will arrive, but it could be a year away.

The new Colorado has just been unveiled in Chevrolet guise at the Bangkok motor show, but Isuzu resisted the temptation to wheel out its D-Max at the same event.

The current battle of the utes is between the long-time market leaders, but they will also be mindful that Volkswagen is about to launch into volume sales of its all-new Amarok, while at least two more Chinese brands with utes in their armoury are getting set to join existing Chinese player Great Wall at the bottom end of the Australian market.

The trick for the various brands will be to get the pricing genie back in the bottle when the replacement models roll off the ships over the next year.

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