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News - VFACTS - Sales 2006 - October

New car sales bounce back

On the up: Commodore had its best sales month so far in 2006.

Australia's new-car industry bounced back in October, with sales up five per cent

7 Nov 2006

NEW cars and trucks bounced back almost five per cent last month, prompting the Australian automotive industry to talk cautiously of an upturn in vehicle sales in the lead-up to Christmas.

After a bout of retrenchments and poor sales affecting Australian-built vehicles, the large-car market too last month showed signs of a modest recovery, according to the latest Federal Chamber of Automotive Industries figures.

Independent fleet analyst Tony Robinson, who runs the Melbourne-based Sureplan fleet risk management company, supported this view – but cautioned that the October result does not automatically translate into a trend.

"The fourth quarter is generally a strong fleet time, especially October and November," he said. "So the figures are in line with the norm. I wouldn't be jumping up and down just yet." Mr Robinson said fleets were also looking at the arrival of the Toyota Aurion as a possible lead in the resurgence of the big-six market.

"When you look at the fuel economy of 9.9 litres, there are a lot of fleets that are saying it could bridge the gap between the medium- and large-car sector," he said. "The package is good and some fleets may look at it and think it will provide real savings." The big-six push will be aided by Toyota's ultra-competitive fleet deals, he said.

Along with the Aurion, the arrival of Holden's VE Commodore and the refreshed Ford BF MkII Falcon, and even the Mitsubishi 380, are providing fleets with plenty of choice, Mr Robinson said.

"Fleets now have access to three very strong six-cylinders out there," he said. "There is even acknowledgement that the Falcon, while the most dated car, is still a very good product.

"Nobody is criticising the product at all – it's just peripheral things like fuel and environmental issues that are making fleets and novated buyers think twice." Mr Robinson said that although large sedans were traditional fleet favourites, many fleet managers – and novated buyers – were now making their decisions "based on their heads and not their hearts".

"They are not just automatically going back into a traditional vehicles." October's VFACTS sales figure showed that 79,930 vehicles were sold last month compared to 76,118 in October 2005.

The result took total sales for the year to 802,306, 2.8 per cent below the year-to-date figure at the same time in 2005.

The FCAI claims the positive effect of the newest six-cylinder entrants like the VE Commodore, helped by a lift in SUV sales and lower petrol prices, had slowed the market's downward trend.

Although light and small cars continued to dominate, there are signs the overall passenger vehicle market is getting stronger despite a slower-than-expected take-up rate for the VE Commodore and the continuing sales woes affecting the Mitsubishi 380, which managed 944 sales last month on the back of a rental fleet deal with Avis.

Holden sold 5455 Commodores last month – Holden's best Commodore month this year and the best-selling car in October – and claimed that "fewer than 20 sales in October were VZ sedans and about 700 were VZ wagons".

106 center imageLeft: Independant fleet analyst Tony Robinson and Toyota's Aurion

The newly launched Captiva SUV managed 393 sales last month, having only been launched on October 5.

According to the FCAI, the total passenger vehicle market rose by 2098 vehicle sales (4.3 per cent) over the same month last year.

The SUV market rose by 1418 sales (11.3 per cent) and light truck market by 284 sales (2.3 per cent), while the heavy commercial vehicle market rose by 12 vehicle sales (0.4 per cent) over October 2005.

Toyota remains market leader and last month was followed by Holden, Ford and Mazda respectively. YTD Toyota leads Holden with a margin of 53,809 vehicle sales, or 6.7 market share points. Toyota has sold 175,953 vehicles this year compared to 122,144 for Holden, the margin ensuring the Melbourne-based car-maker is on track for market leadership this year.

"The October result suggests that the motor vehicle market may be pulling out of the slight decline of results in recent months and tallies with our prediction of a stronger fourth quarter following important new model releases," FCAI chief executive Peter Sturrock said.

YTD the automotive market is down by 23,148 vehicles or 2.8 per cent and the FCAI has projected an end-of-year total of 970,000 – which would still be the second-highest on record.

Sales in the light passenger car segment rose by 2382 vehicles or 31.3 per cent over October last year, partly at the expense of the small-car segment, sales of which fell by 1328 or 7.0 per cent.

The medium-car segment also performed well, jumping by 1479 sales, while large-car sales were just 398 vehicles off the total in October last year.

"The large-car segment is starting to feel the positive effect of the new Holden Commodore and the industry looks forward to the segment receiving a further boost this month when the new Toyota Aurion goes on sale," Mr Sturrock said.

It was also notable that sales of 4WD vehicles appear to be recovering slightly, he said.

"A rise of 11.3 per cent in SUV sales last month suggests that some consumers may have set aside their concerns about the petrol price spike that occurred over winter." Sales of light commercial vehicles rose slightly in October (2.3 per cent), although the segment is down 2.8 per cent YTD.

The FCAI says the automotive industry has started a huge end-of-year sales push with massive television and print campaigns.

"Last week’s opening of the Australian International Motor Show in Sydney began an intense period of sales and marketing activity running up to Christmas, and we believe that November and December sales will be strong," Mr Sturrock said.

Apart from the Commodore, other solid performance last month were the Toyota Corolla (3722), Toyota Camry (3205), Ford Falcon (2945), Toyota Yaris (2858), Mazda3 (2585), Hyundai Getz (1594), Ford Focus (1584), Holden Astra (1575), Toyota HiLux 4x4 (1457), Nissan Navara 4x4 (1327), Mitsubishi Lancer (1242) and Honda Civic (1019).

Ford's Territory SUV recorded 1349 sales, slipping from 1418 in September.

Mitsubishi's steady sales last month are giving the company confidence of some positive improvement at the coalface after recent closure speculation, fuelled by an ABC report, over the slow-selling 380.

In a market that was down 2.8 per cent year-on-year, and 0.05 per cent on September last year, Mitsubishi held its overall market share at 5.4 per cent for September and 5.6 per cent YTD. The Lancer small car and Grandis people-mover have maintained volumes, while the Colt light car has shown some improvement over previous months and the same month last year. The new Triton 4x4 is proving a sales hit with 852 sold last month.

"We are now seeing the acceptance of the vehicle (Triton) by the buying public," Mitsubishi Australia CEO Robert McEniry said. "After the release of any new vehicle it takes a month or so for the true sales numbers to become evident." Mr McEniry remains confident about 380 sales.

"380 was launched in October 2005 and we are line-ball with sales year on year in a market which is down nearly 20 per cent year to date," he said.

THE TOP 10 YTD
Brand Vol Share%
1. Toyota 175,953 21.9
2. Holden 122,144 15.2
3. Ford 97,895 12.2
4. Mazda 53,253 6.6
5. Honda 45,428 5.7
6. Nissan 44,671 5.6
7. Mitsubishi 44,624 5.6
8. Hyundai 39,570 4.9
9. Subaru 31,063 3.9
10. Kia 17,761 2.2
Source: VFACTS, November 2006

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