Car sales plunge eases in May

OFFICIAL May motor registration figures out tomorrow from VFACTS are expected to show further signs that the market is bottoming, with the decline in monthly sales over last year moderating from more than 20 per cent so far this year to about 17 per cent.

The scenario is echoed in Japan where May sales were down a comparatively good 19.4 per cent, compared with almost 29 per cent in April and 31.5 per cent in March.

The glimmer of hope in Australia came from GM Holden managing director and chairman Mark Reuss who said swift federal government actions to provide business tax incentives to buy cars and also fill the void in car dealer financing in Australia were beginning to take hold.

“You will see that in the industry figures this month, where we will see moderation on the 20 per cent falls we have seen in past months,” Mr Reuss said during his media conference to discuss Holden’s future in the wake of GM’s Chapter 11 bankruptcy.

“You will see the market probably off around 17 per cent instead of 20 per cent.” Although the fall in Japan was smaller than in previous months, last month was still the worst May sales figure on record in Japan, which has now notched up 10 consecutive months of automotive industry decline.

Japanese wages fell for the 11 consecutive month in April, when household spending fell 1.3 per cent and the national unemployment rate reached a six-year high of five per cent.

According to JAMA, a total of 178,503 new cars, trucks and buses were sold in Japan last month, compared with 221,377 during May 2008.

Toyota’s total of 80,503 (excluding minicars, which comprise up to 40 per cent of new-vehicle sales in Japan) was 24 per cent down last month, when Nissan sales fell 9.1 per cent.

Japan’s number two auto-maker, Honda, posted a 4.5 per cent sales increase, partly due to new government incentives for buyers of fuel-efficient vehicles that came into effect on April 10.

The Japanese government expects the new ‘hybrid subsidy’, which provides a cash-back rebate for those who trade in cars 13 years or older for ‘greener’ cars, to increase sales by some 690,000 vehicles this fiscal year.

Toyota said on May 8 that has received more than 80,000 orders for the third-generation Prius due on sale in Australia in July, while Honda said on May 21 that its new Insight, which isn’t due here until next year, has attracted 35,000 orders.

Meantime, latest production and domestic sales figures released by Toyota Motor Corporation (TMC) 28 show the world’s largest auto-maker produced more than 50 per cent fewer passenger cars in Japan in April. Including trucks and buses, TMC production in Japan decreased by 49.1 per cent in April.

TMC passenger cars sales (including Daihatsu) decreased by 27.3 per cent in Japan in April, when Toyota Australia also posted an uncharacteristically sharp 37.5 per cent month-on-month sales slump.

Exports of TMC passenger cars from Japan declined by a massive 72.0 per cent in April. Combined with a 43.9 per cent decline in overseas production in April, worldwide TMC production declined by 46.5 per cent during April.

Toyota last month said it expected to sell about one million vehicles less that forecast in its current fiscal year, when it has also predicted a larger-than-expected $A12.6 billion operating loss.

Read more:

Troubled times at Toyota