Market Insight: Battle royal looms for second place

TEN years ago, Australian car-maker Holden sold about twice as many Commodores as South Korean importer Hyundai sold vehicles in Australia.

The famous lion badge graced 178,027 vehicles registered in Australia that year, with more than half of them made at Holden’s Elizabeth factory in South Australia.

The Commodore sedan and wagon accounted for a tick under 80,000 units, with the related Holden Ute and Caprice taking the locally built tally to more than 100,000.

Including various imported cars, Holden dealers shifted average of 14,835 vehicles a month out of their showrooms.

By contrast, Hyundai sold 42,510 cars in 2004, for a monthly average of 3542 units.

Down the road at Mazda, the Japanese importer managed 55,560 vehicles that year, with a batting average of 4630 a month.

A decade down the track, Holden’s monthly average has slipped to 9216 units – a decline of almost 38 per cent – while Mazda’s is sitting at 8555 and Hyundai’s at 8372.

As our graph shows, the gap has been closing relentlessly, and with Holden on track to shut its Australian factories in three years, it could slide more.

Over the years, Holden has also suffered the indignity of seeing its long-reigning top-seller, the Commodore, ousted by the Mazda3 small car as the most popular car in the land.

In the nine months to the end of September this year, Holden has sold 23,783 Commodore sedans and wagons, while Mazda has registered 33,083 Mazda3s for customers – about a third more.

Hyundai is on target to sell more than 100,000 units in Australia this year for the first time. According to company insiders, it probably could have achieved that milestone last year, but its supplies were restricted by head office to just short of the tally, at 97,000.

Rival for the top importer crown, Mazda, is on target to zoom-zoom straight past its 2013 tally of 103,114, provided it has good supplies of its new Mazda2.

Its Mazda3 is vying with Toyota’s Corolla for the top-selling car crown, and its CX-5 compact SUV is leading the SUV pack.

This means Mazda has hit a bullseye in Australia’s two most popular segments, and is battling Hyundai in a third – the light car segment – where their i20 and Mazda2 hatches strut their stuff.

Interestingly, most of Mazda and Hyundai’s cars incur Australia’s five per cent import tariff, coming as they do from Japan and South Korea.

An exception is Mazda’s BT-50 ute that is imported from Thailand, which has a free-trade agreement with Australia.

Sometime soon, similar free-trade agreements will kick in with both Japan and South Korea.

Holden’s parent company General Motors went on record last week with its plan to introduce more Opel-developed models into the Holden range, most likely in place of the Korean-built Chev-based cars such as the Barina.

Unless Holden can find a duty-free production base for those cars – and Thailand is looming as a distinct possibility – it might again be at a disadvantage to its tariff-free rivals by importing cars from Europe.

Whichever way we slice it, a three-way battle royal is looming for second place in the Australia motor vehicle market, behind long-time market leader Toyota.