VFACTS: Sales threaten to stall in September

VFACTS, the Australian automotive industry sales statistician, reports that September new vehicle sales numbered 80,938 units. By comparison with the September 2007, that's a 2551-unit deficit (-3.1 per cent).

According to the accompanying press release from the Federal Chamber of Automotive Industries (FCAI), the figure was not so parlous when compared with August '08. The September total was 3614 vehicles or 4.7 per cent up on the previous month's figure and the FCAI rates the September performance as even better when seasonally adjusted -- up 5.5 per cent on that basis.

But that's comparing the September figure with a 'horror month' in August, when sales were over 10,000 units behind the August 2007 figure. With two consecutive months of stagnant sales, the year-to-date total for the industry is 784,932 units -- just 0.3 per cent ahead of the 2007 YTD figure as of September. The FCAI is still forecasting a 2008 market of over a million vehicles -- but it won't be another record-breaker like 2007 was. All the same, it's still over 60,000 units ahead of the YTD figure for 2006.

Only four of the top ten car companies have posted a sales improvement, for the year-to-date period of 2008. In descending order of volumes, they are: Toyota, Mazda, Subaru Volkswagen. The remaining six -- Holden, Ford, Mitsubishi, Nissan, Honda, Hyundai -- have sold less for the year so far than they did over the same period in 2007. Despite the fluctuating fortunes, Holden remains in second-place, behind top-selling Toyota. Ford remains third, with Mazda and Mitsubishi in third and fourth, respectively.

By class, passenger vehicles, SUVs and heavy commercials all achieved reduced sales during September, year-on-year. Only light commercials picked up extra sales over September '07 -- a relatively paltry 559 units for the month. That's versus 1332 fewer passenger cars, 1674 fewer SUVs and 104 fewer heavies.

Of the passenger-car class, only small and medium cars showed signs of growth. Surprisingly, considering the state of the economy and the apparent consumer fixation with fuel prices, large SUVs also sold in higher numbers during September 2008, offsetting a sales slide in other SUV segments. When you look closer at the large SUV segment however, it's plain that the growth is almost entirely attributable to the performance of the 200 Series LandCruiser, which wasn't introduced at this time last year.

The LC200 has been consistently selling at an average rate of 1000 units a month in 2008, but only managed 676 in September. For September 2007, the run-out 100 Series model sold just 334 units, so the improved sales for the large SUV segment should be seen in that light.

With the release of the latest VFACTS figures, the FCAI is arguing in favour of further interest-rate reductions to reinvigorate consumer confidence.

"The September figures provide further evidence that car buyers are cautious about the current economic situation and outlook," says FCAI Chief Executive Andrew McKellar.

"The trend in sales over recent months provides justification for further action to cut interest rates as soon as possible.

"The industry is looking to rebuild confidence in the marketplace and decisive action to take further pressure off interest rates will provide some welcome relief to motorists."

It's entirely possible that the passenger car class is still affected by the uncertainty over the Luxury Car Tax increase (now resolved, but not in favour of consumers) and the economic situation in the US -- hopefully ameliorated in part with the US federal government's US$700 billion bailout. Sales in October should be a stronger indicator of which way the market will head.

The top selling vehicles for September were: Holden Commodore (4462 units sold), Toyota Corolla (3964 units), Toyota HiLux 4x2 and 4x4 combined (3364 units), Mazda3 (3241 units) and Ford Falcon (3123 units).

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