Leading importer confirms imports are hurting Commodore and Falcon

The managing director of one of the fastest-growing car companies in Australia, German importer Volkswagen, has confirmed locally-made vehicles are losing out to foreign brands – and will continue to face an uphill battle as the value of the dollar remains strong.

Anke Koeckler says sharply-priced, wide-ranging foreign brands are taking sales away from struggling local heroes, the Holden Commodore and Ford Falcon.

“People are rethinking their old consumer behaviour and not sticking any more with locally-produced cars,” Ms Koeckler told motoring.com.au. “They are experiencing more and more the alternatives. I can’t give you a percentage but [some VW customers] are coming from [Holden and Ford], otherwise we wouldn’t make it that we are growing over the years.”

Ms Koeckler said the Australian market has remained relatively stable over the past five years – but Volkswagen sales had grown dramatically in that time. “The total market is not increasing so we have to take it from the different competitors.”

When asked what motivated buyers to make the switch, she said: “I think it’s the perception of fuel economy and new cars coming to the market with a very attractive design. I think it’s a similar trend which we experienced in Europe, this downsizing trend. Even in the US we are also seeing this trend as well.”

Ms Koeckler said Australian car makers face “a challenge” to make their factories viable locally, adding that she wasn’t aware of a Volkswagen factory in the world that produced fewer than 50,000 cars a year – the number that Ford Australia is likely to dip under this year.

“They try hard but they are in a difficult situation. Looking more into Ford and Holden, it’s difficult for them. I think you need much better economies of scale to make [local production] feasible.”

Ms Koeckler said while sales of large sedans have plateaued in Australia, they remain popular in emerging markets.

“Big cars are very important in the emerging markets such as Russia and China. In China we have the Passat on a longer wheelbase because they have a whole different use. The professionals are always sitting in the back. In India it’s the same.”

However, export programs from Australia to these countries would be hamstrung by our strong currency, she said.

Read the latest news and reviews on your mobile, iPhone or PDA at carsales' mobile site...