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VFACTS: COVID-19 crushes car sales

On a roll: Toyota’s RAV4 was second only to HiLux in terms of individual vehicle sales across the industry last month, and the only leading model in positive territory – up 54.4 per cent.

New-car sales plunge 48.5 per cent in April as COVID-19 crisis keeps buyers at home

5 May 2020

NEW-VEHICLE sales in Australia plunged almost 50 per cent last month and most major car companies found their volume more than halved as the coronavirus pandemic took hold and the nation adhered to directives from governments to ‘Stay Home, Save Lives’.


Many dealerships remained open but the monthly sales results released this week show just how much damage the COVID-19 wrecking ball has inflicted on the industry, with 38,926 registrations in April marking a 48.5 per cent collapse, or 36,624 fewer sales, compared to the corresponding month last year.


This is the biggest decline of any month since figures were first recorded in 1991, and comes on top of a 17.9 per cent downturn in March.


It is also the 25th consecutive month of negative growth for a sector that for more than two years now has been undermined by a litany of financial, political and environmental issues, from tight credit lending restrictions to flood, drought, bushfire and other catastrophes.


It remains to be seen whether we have now reached rock bottom, but senior executives from several leading car manufacturers report that enquiry rates have increased over the past couple of weeks, with consumers starting to consider a new motor vehicle purchase as social restrictions ease and a degree of confidence filters in that Australia has a handle on the health crisis.


The sector, led by the Federal Chamber of Automotive Industries (FCAI) and other peak representative bodies such as the Australian Automotive Dealer Association (AADA), is also now calling on more to be done by government to stimulate sales growth.


As expected, some fascinating results were logged amid the wreckage, such as BMW finishing seventh overall by overtaking not only arch-rival Mercedes but a bevy of volume-selling mainstream brands including Holden, Nissan, Volkswagen, Subaru and Honda.


Kia found itself among the top three brands, Lexus overtook Audi to place among the top three premium brands, and major players such as Mazda, Hyundai, Mitsubishi and VW all suffered a sales downturn of more than 60 per cent for the month.


Among the 50 light-vehicle brands active in the marketplace, only two recorded a sales increase for the month: MG and Ram.


Unshakeable market leader Toyota was not able to avoid the carnage but still posted 10,000-plus sales – more than 7300 units clear of its nearest rival, Mazda – and increased its market share to more than a quarter of all vehicles sold across Australia last month, at 26.5 per cent.


No fewer than five of the top six best-selling vehicles last month were Toyotas, led by HiLux and backed by RAV4, LandCruiser, Corolla and Prado. Ford’s Ranger was the only model to make an indent, finishing fourth.


In announcing the results, which now see the industry down 20.9 per cent for the year to date, FCAI chief executive Tony Weber said the results reflect “a downturn in the broader economy right across the country”.


“Figures recently released by the Australian Bureau of Statistics show that 31 per cent of Australian citizens have experienced a decrease in income due to the pandemic,” Mr Weber said.


“In addition, 72 per cent of Australian businesses reported that reduced cashflow is expected to have an adverse impact on business over the next two months.


“These conditions inevitably impact consumer confidence and purchase decisions.”


Mr Weber said the FCAI’s members – the vast majority of the car and truck brands – were providing financial and sales target relief to stressed dealerships, and that these retail outlets remained open for business, having transformed their operations to be accessible and safe.


“We know that our member brands are doing everything they can to assist both their dealerships and their valued customers during this difficult time,” he said.


“But more needs to be done. We are calling on federal and state governments to consider the automotive industry, which employs over 65,000 people in Australia, when compiling their recovery plans.


“The JobKeeper and JobSeeker payment programs put in place by the federal government are a welcome initiative. However, we believe the scope needs to ensure high-turnover and low-margin businesses, such as new-car dealerships, are covered.


“These businesses are often the backbone of local communities and in the current environment, many are facing overwhelming challenges.


“As well as continued business initiatives, support to bolster consumer confidence is imperative to the strength of our economy.


“We have begun to see a slight lift in consumer confidence as the COVID-19 restrictions start to ease. We really need further measures to support this confidence and continue the positive trend.


“Initially, we would ask that the instant asset write-off package is extended to further stimulate business purchasing.”


The April VFACTS figures show business vehicle purchases were down 49.6 per cent last month, with private purchases close behind on -47.7 per cent. Lower-volume rental vehicle sales were down 78.9 per cent as the tourism industry closed down, while government sales were less impacted, sliding 12.6 per cent.


There were deep downturns of between 20 and 73 per cent for the month across individual vehicle categories, while among the states and territories the small ACT market was the only one to return a positive result, up 24.7 per cent as replacement deliveries continued in the wake of the massive hailstorm event earlier in the year.


New South Wales, Victoria, Queensland, South Australia and Tasmania were all down by about 50 per cent.


For the record, Toyota’s 10,325 sales was 31.8 per cent fewer than April last year, but miles ahead of second-placed Mazda, which took a 60.5 per cent hit to just scape in over 3000 units for the month (3022).


Kia’s podium position came with 2492 sales, down 44.9 per cent but relegating Ford to fourth (2251, -53.1%) and South Korean stablemate Hyundai, which is usually the dominant partner, to fifth. The latter’s 2247 sales marked a 65.3 per cent decline – the deepest among the leading brands.


Mitsubishi was similarly struck and finished in sixth (1734, -63.2%), just ahead of the unfamiliar sight of BMW in seventh (1703, -5.7%). This is the first time the German premium marque has found itself among the top 10 brands.


Holden was a couple of hundred units further back (1501, -56.9%) as it draws closer to its market exit and final deliveries are made to buyers grabbing a bargain from the remaining stock, mainly for the Colorado ute.


Rounding out the top 10 was Nissan (1468, -51.5%) and Volkswagen (1328, -62.1%), while sitting outside was Subaru (1282, -57.4%), Honda (1052, -60.0%) and Mercedes-Benz Cars (981, -54.4%).


Audi recorded only 373 sales (-63.6%), which saw Lexus (-42.8%) slot in ahead with 411 units on the dimly lit scoreboard.


MG’s phenomenal run continued last month with a 1.5 per cent increase to 414 units, which is a remarkable feat in the current climate and sees its sales up 75.6 per cent for the year to date.  


Ram sold 178 pick-up trucks, up 14.1 per cent on April last year as Australian buyers continue to value its 1500 model in particular.


Top 10 Brands April 2020

Ranking Brand Sales Share% 
1 Toyota 10,325 26.5
2 Mazda 3022 7.8
3 Kia 2492 6.4
4 Ford 2251 5.8
5 Hyundai 2247 5.8
6 Mitsubishi 1734 4.5
7 BMW 1703 4.4
8 Holden 1501 3.9
9 Nissan 1468 3.8
10 VW 1328 3.4


Top 10 Models April 2020

Ranking Model Sales
1 Toyota HiLux 2339
2 Toyota RAV4 1911
3 Toyota LandCruiser 1603
4 Ford Ranger 1540
5 Toyota Corolla 1195
6 Toyota Prado 947
7 Kia Cerato 860
8 Holden Colorado 854
9 Isuzu Ute D-Max 760
10 Hyundai i30 695


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