The King is dead... Long live the King!

Words - Otto Insider

The magic million seems all but a fading dream. The Holy Grail for car industry pundits was that Australia would join the premier league of car-buying nations with its first seven figure sales year in 2005.

Well, we fell short. This time last year, it was looking good, with 500,078 runs on the board.
This year, while not exactly suffering a dearth of buyers, just 483,160 new vehicles were sold in the first six months. That’s still a healthy result by historical standards.

If you’ve checked your bank statement lately or your wages or your mortgage repayments, you should only be seeing good news. Interest rates are still historically low. You have a wage packet and it’s bigger than last year’s, the government has even pulled its hand out of your pocket a little further and the cost of cars in real terms continues to fall.

Twelve years ago, $22,000 would buy a Ford Laser. Unlike the $22,000 Ford Focus of 2006, the 1994 Laser didn’t have dual airbags, air conditioning, ABS, or as fuel-efficient a motor for your hard earned. Would that house prices were still as comparable!

So why are fewer folk in showrooms this year, signing on the dotted? For one big reason and one ‘wanna-be big’ reason – Holden’s VE Commodore and the new Toyota Camry.

The VE won’t make it to showrooms until August but it’s creating a buzz with aggressive pricing and a limited edition already announced (click

Toyota will wheel out a new Camry next week (check out CarPoint’s launch review on July 26), restricted to four-cylinder power for the first time in its history in Australia. You can bet Toyota will make the Camry look like a teetotaller to VE’s six-pot screamer. (For big-engined Toyota jollies you’ll have to wait for Toyota’s Aurion until later in the year).

But with all this waiting for the Toyota Godot and VE, the market has shrunk back.

So will Holden’s all-guns-blazing VE launch stop the sales recession in its tracks and pundits start hailing the million-model market once again?

Last time Holden launched a new six-cylinder Commodore the price of fuel was around 0.60/lt, now it’s threatening $1.50. A new VE with a thirst like a Kalgoorlie miner won’t appeal to fleet owners or private buyers. And there’s no diesel engine on the horizon, nor slick four-cylinder, not even a trick six (or eight!) with cylinder deactivation. The noises Holden’s made about alternatives are more hype than hybrid.

A quick look at the figures reveals Commodore shed 10,000 sales in the first half of 2006 compared with 2005, albeit it in a very public run-out environment. Even loaded with rigour-mortis resisting special equipment models, Holden would have hoped for a softer landing for the venerable VT generation.

Falcon’s coasting too, not quite on empty, but 20 per cent off last year and with nothing new in sight, it may feed on Holden buyers at the far end of the VE queue.

Last year you could have bought a V6 Mitsubishi Magna or V6 Toyota Avalon. This year they are dead. The Mitsubishi 380 is here, but sales are 236 down on last year, even allowing for 555 left over Magnas in this year’s figures. A disaster.

Among the big-six-engined imports Nissan Maxima sales have all but halved, and the American styled Honda Accord is off 18 per cent, though some of those sales are four-cylinder cars.

Slow six sales in the first half have been offset by strength in the light car market. Thrifty tiddlers with remarkable fuel efficiency are 20 per cent stronger this year, or around 10,000 sales to the good.

There are some stand-out performers, notably the new Toyota Yaris. New look, new name, but same old Toyota qualities have successfully converted tiny tin-top buyers. Yaris success is echoed by Holden who reinvented the chic Euro-sourced Barina with a South Korean made model. It all but doubled the local lion cub’s sales.

Ford’s friendly Fiesta and Suzuki’s sexy Swift have also made their mark in the market where city chic and teen-appeal spell super-sized success.

Got a tape measure? You’d be in for a surprise if you ran one around the cars in the Small car class. Talk about middle age spread. The Nissan Tiida, VW Golf and Honda Civic of 2006 would easily mirror the shadow cast by family cars of 20 years ago. Only now they’re powered by the last word in four-cylinder frugality, with Golf pitching to penny pinchers with its effective diesel engine offerings.

Ford has finally found the right focus for its small car, doubling sales compared with the first half of last year (when the old car was running out).

Honda’s massive Civic is centre stage with city folks after a spacious space-age sedan, so much so the factory can’t supply. Which is probably good news for Nissan and Holden.

Astra’s star has fallen as the ultra-modern new model supplants a firm (if Polish built) favourite; not even the budget-priced South Korean-sourced Viva can make up the shortfall.

The gold standard in automotive white noise is of course the Toyota Corolla, of which 22,847 have been sold in the first half of the year. That’s 21 per cent of the biggest single market sector. The question is, are they making money?

And one more thing. Contrast Nissan’s name change failure for Pulsar (now Tiida) with Toyota’s sales success switching Echo for Yaris.

Nissan has achieved the impossible. Proving sex doesn’t sell (in Aussie cities, anyway).