VFACTS July: New car market still sluggish

Toyota still dominates new car sales, HiLux the top seller with Corolla second, leap-frogging Ford Ranger ute.

VFACTS July: New car market still sluggish

Toyota still dominates new car sales, HiLux the top seller with Corolla second, leap-frogging Ford Ranger ute


Australians are still favouring dual-cab utes and SUVs over passenger cars when it comes to buyer behaviour, but challenging financial conditions continue to put negative pressure on new vehicle sales.

Year on year, the month of July 2019 saw a 2.8 per cent decrease in new car sales compared to 2018. However, that drop was significantly less than the 10 per cent slump recorded the month prior.

Year-to-date, with 83,184 sales last month, the industry tally is now 637,650 vehicles -- 7.7 per cent lower than the same period in 2018.

The SUV segment continues to be the most popular last month with 37,894 sales being down by 3.6 per cent on the same month in 2018. Light commercial vehicles (read: mostly utes) were down by 3.5 per cent with 16,710 sales.

While passenger vehicles recorded 25,386 sales, the segment was down by 11.1 per cent compared to the same month in 2018, as Aussies continue to look for high-riding, multi-purpose vehicles in the SUV and ute categories.

Toyota continued its dominance of the Australian new vehicle market with a 21.5 per cent market share (17,876 sales) in July. Mazda snaffled second place with 9.9 per cent (8227) and Hyundai was the third most popular brand in July with 8.4 per cent market share (6983).

The Toyota HiLux ute continues to sit at the top of the table as Australia's most popular new vehicle, with 3359 sales in July.

The Toyota Corolla (3244) bounced back from an average prior month – when it was outsold by the Hyundai i30 – to wrest the mantle of the second-best-selling car of the month from the Ford Ranger (3168).

The top-five was rounded out by the new Toyota RAV4 (2419) and Hyundai i30 (2252).

"The July sales figures continue to illustrate the tough market conditions facing the Australian automotive industry, and the sensitive nature of the economy over the past twelve months," said Tony Weber, chief executive of the Federal Chamber of Automotive industries (FCAI).

"Tight financial lending, drought, increasing Luxury Car Tax imposts and the Federal election have all contributed to make the Australian car market one of the toughest in the world.

"But it is great news for the consumer who is spoiled for choice with attractive new car offers as automotive brands provide excellent deals to stimulate sales growth," Weber said.

It would be an understatement to call 2019 a tough year for new car sales with only two brands in the top 10 recording growth.

Up to the end of July 2019, Mitsubishi has had 0.4 per cent growth compared to the same period the year prior. Strong performers include the Triton ute, Outlander medium SUV and ASX small SUV, all selling around 10,000 units each thus far.

Kia meanwhile saw 2.3 per cent growth as its seven-year warranty finds favour with buyers and models such as the Cerato small car and Sportage medium SUV continue to deliver strong sales for the Korean brand.

As European prestige brands struggle in 2019, with BMW (-4%), Mercedes (-13%) and Audi (-32%) all suffering as more luxury car taxes continue to bite, Swedish brand Volvo has bucked the trend, with a 26 per cent increase in sales.

Sales of the Volvo XC40 compact SUV - which was named carsales.com's 2018 Car of the Year - rose by 233 per cent, from 528 to 1760 units. The bigger Volvo XC60 also made dividends for Volvo, 1870 sales, up 18 per cent on the previous year's tally.

Even the $100,000-plus Volvo XC90 was up by almost 13 per cent.

Holden has been doing it tough since locally-made Commodore stock dried up in 2018, but its July result (-16%) was less dire than June (-34%), the bleeding appears to have lessened.

As large sections of the automotive market struggle, Chinese budget brands such as Haval and MG are starting to find favour with buyers.

Haval, a cut-price luxury SUV brand, has seen sales soar by 155 per cent in 2019, from 307 units to 783. The big winner for Haval has been the compact Haval H2, which is priced from $19,990 drive-away, and whose sales rose by 221 per cent from 124 to 399 sales.

Former British car-maker and now Chinese-owned budget brand MG saw its sales rise by 253 per cent on the back of strong uptake for its MG ZS small SUV and the MG3 compact hatch.

July 2019 top brands

Toyota – 17,876

Mazda – 8227

Hyundai – 6983

Mitsubishi – 5247

Ford – 4900

Kia – 4506

Nissan – 3804

Volkswagen – 3609

Subaru – 3513

Holden – 3266

Source: FCAI VFACTS, July 2019.