Market Insight: Lots of fish, not enough chips

AMID a sea of rising new car sales across the board in May, the euphoria of success is dulled slightly by underlying erosion caused by the ramifications of the pandemic, particularly a dire shortage of semiconductors used extensively in modern cars.

The biggest hit is seen in the small passenger car segment, making it one of two categories – alongside the upper-large passenger car segment – to score a negative in the first five months of this year compared with the corresponding period in 2020.

For the month of May, the small-car segment was up by 23.8 per cent on 2020 but it was a stock shortage that held it back.

Affected models include the Ford Focus (imported from Thailand) with a 42.2 per cent drop year-to-date and a fall for May of 47.9 per cent compared with the same month in 2020.

The same slide hit Honda’s Civic – also a product of Thailand – which is down 46.9 percent in the five months compared with 2020 and down a substantial 73.8 per cent on May 2020.

Volkswagen had a similar plunge in the year-to-date figures, with its Golf down 91.9 per cent (though a monthly rise of 60.2 per cent in May) as the current model runs out ahead of the Golf 8 launch but also in response to Volkswagen’s official statement from Germany about difficult supply issues with semiconductors for its models.

Other falls were recorded by the Toyota Prius, which was down 50.0 per cent year-to-date due to the chip shortage, but performed better in May with a 66.7 per cent rise on improved stock flow.

The Hyundai Ioniq was also down 28.8 per cent for the first five months but up 3.8 per cent in May due to the same stock improvement reasons.

In the over-$40,000 bracket for small cars, Audi’s A3 was down a fat 71.0 per cent in the year and a giant 97.6 per cent in May – like the Golf it is about to be superseded – while the Mercedes-Benz A-Class range fell 32.9 per cent in the year and 8.8 per cent for May.

This was a surprise for Mercedes as the A-Class is the sector’s most popular $40,000-plus small car. Despite its fall, it still holds that title ahead of the BMW 1 Series.

Although there were some unexpected downsides, the small-car category showed some strong winners capped by the ongoing success of two of its biggest players, the Toyota Corolla and Hyundai i30.

The Corolla, which gets attention from fleets more than private buyers, put in a solid May with 2190 sales representing a rise of 10.7 per cent on the same month last year, while its year-to-date was up 34.7 per cent at 11,644 deliveries.

Hyundai’s i30, including the newly added sedan variant, jumped to 2127 sales in May, up 78.6 per cent on the previous year and made 10,808 sales YTD to knock on the Corolla’s door.

Sister company Kia also did well with its Cerato small car up 143.7 per cent in May with 2054 sales and a gain of 16.3 per cent for the year with 8045 new owners despite a revised model due to launch this month. It is another nameplate threatening to catch up with the Corolla.

New-car buyer attention also turned to Subaru that while having similar issues to its peers with the chip shortage, lifted the Impreza sales by 45.9 per cent in May (353 units) and up 25.0 percent for the year (1500 sales).

Subaru has made it public that it is ending the WRX and WRX STI models ahead of the replacement models. Buyers have clamoured for the pair, with the STI special edition that marks the end of this generation being snapped up.

Buyers then hooked into the WRX and its sales jumped. Overall, the WRX and WRX STI lifted sales by 120.8 per cent in May (170 sold) and 60.2 percent (689 units) YTD, while Subaru said it could have easily sold a lot more if stock was available.

Alfa Romeo rarely makes sales news, but its Giulietta found 13 buyers in May to total 58 for the year, a healthy 160 per cent rise for the month and almost 35 per cent for the year.

Much of the activity is to do with enthusiasts recognising its swan song. The Giulietta name has been around since 1954 and this is its last year. The small hatch is to be replaced with the Tonale SUV in late 2022.

In the expensive section of the small-car sector, growing interest in EVs and the lauded reception of its new generation model pushed the Nissan Leaf to find 191 sales this year, up 48.1 per cent on 2020. It sold 42 cars in May, a rise of 200 per cent on May 2020.

Mini’s Clubman also lifted sales, up 33.6 per cent year to date with 159 sales and May up 48 per cent and 37 sales, while Lexus has sold 50 CT200h hatchbacks this year and experienced a 200 per cent jump in May with 15 units selling during the month.

BMW also scored well with its 2 Series Gran Coupe showing 901 sales this year (up 117.1 per cent on 2020) and 195 for May (up 22.6 per cent) while the 1 Series range has found 1236 new owners in 2020, up 28.9 per cent.