Home Car News Consumer confidence hammered as COVID-19 destroys new car sales

Consumer confidence hammered as COVID-19 destroys new car sales

COVID-19 continues to slam new car sales figures
The Toyota HiLux remains atop the new car sales figures month by month

THE new car market has been decimated by falling consumer confidence in the wake of the COVID-19 pandemic, with a 48.5 per cent decline in new car sales in April, the worst single drop in VFACTS history.

“A total of 38,926 sales were recorded for the month. This figure represents a fall of 48.5 per cent over the same period last year (75,550 sales), and the largest single decrease of any month since VFACTs figures were first recorded in 1991,” FCAI CEO Tony Weber said.

“Clearly, the COVID-19 pandemic has had a major influence on the April sales result, and reflects a downturn in the broader economy right across the country,” he added.

Figures recently released by the Australian Bureau of Statistics show that 31 per cent of Australians have experienced a decrease in income due to the pandemic, and 72 per cent of Australian businesses have reported reduced cash flow.

The Australian new vehicle market has been under stress for some time, with April 2020 representing the 25th consecutive month of declining sales on a year-on-year basis (for example April 2020 compared to April 2019).

Environmental, economic and political factors, along with tight credit lending restrictions, have all contributed to the fall.

According to Mr Weber, the automotive industry in Australia has focused on keeping dealerships open to ensure customers can access sales and important maintenance services for their vehicles.

“More needs to be done. We are calling on Federal and State Governments to consider the automotive industry, which employs over 65,000 people in Australia, when compiling their recovery plans,” Mr Weber said.

“The JobKeeper and JobSeeker payment programs put in place by the Federal Government are a welcome initiative. However, we believe the scope needs to ensure high turnover and low margin businesses, such as new car dealerships, are covered.”

Pandemic and financial strain aside, Toyota remains the number one car brand in Australia, with a 22.2 per cent market share. Their nearest rivals, Mazda and Hyundai, have less than 10 per cent market share. Mitsubishi and Kia round out the top five.

The Toyota HiLux still holds the top spot, but the Ford Ranger has been pushed back to fourth, overtaken by the RAV4, the only vehicle in the top ten to experience year-on-year growth, and the LandCruiser to give the Japanese car maker the top three.

Toyota’s dominance of the top ten continues with the Corolla in fifth and the Prado in sixth, ahead of the Kia Cerato, Holden Colorado, Isuzu D-MAX and Hyundai i30.

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