VFACTS figures show car sales soared in June

Cost of living pressures have failed to dampen our enthusiasm for new cars, as buyers flock to electric vehicles and cheap Chinese brands.

The Tesla Model Y is a runaway success. Picture: Mark Bean.

New-car sales surged by 25 per cent in June, driven by booming demand for electric cars and cut-price Chinese brands.

Higher interest rates and cost of living pressures have failed to dampen our enthusiasm for new cars, while improved supply has allowed the industry to deliver more vehicles to customers.

The Federal Government’s move to waive the fringe benefits tax on electric cars bought through salary-sacrifice packages has sparked unprecedented demand for electric cars, with Tesla’s Model Y SUV becoming the second best selling vehicle in the country in June, behind the Toyota HiLux.

Tesla sales in the first six months of this year were more than five times higher than the brand reported in the same period last year.

The Tesla Model Y was the second best selling vehicle last month. Picture: Mark Bean.

Australians took delivery of 124,926 new vehicles last month, the highest June result since 2018.

Sales were up 8.2 per cent in the first six months of this year.

Federal Chamber of Automotive Industries chief executive Tony Weber said that despite the strong result, supply of new cars remained restricted.

“Indications from our members are that demand for new vehicles remains solid, but the supply is not yet at a point to meet this demand. To put it simply, if we could have landed more vehicles, this would have been a record June result,” he said.

He said the business was monitoring the broader economic conditions and their potential to impact on vehicle purchasing decisions by fleets, businesses and families during the second half of the year.

Sales of electric vehicles continue to surge and Australians bought more EVs than hybrid vehicles in the first half of the year.

Cheaper EVs such as the BYD Atto have proved popular with buyers. Picture: Thomas Wielecki

EVs made up less than 2 per cent of the market a couple of years ago, but in June that figure was 8.8 per cent. In the first half of the year, EVs made up 7.4 per cent of new-car sales.

Tesla has led the growth. In June it was the sixth most popular brand in the country, outselling established names such as Mitsubishi, Nissan and Volkswagen.

More than 16 per cent of new-car sales in June were either hybrid or electric vehicles.

“The early adopters of the new powertrain technology continue to push up the sales of

electric vehicles across the country,” Mr Weber said.

“The steady introduction of new battery electric models across all model segments at

more competitive price points is critically important as we deal with the challenges of

supplying electric vehicles that meet business and personal consumer needs at prices

the mainstream buyers can afford,” he said.

Sales of Chinese cars continue to surge, with MG leading the way. Picture: Supplied.

The recent arrival of cheaper electric vehicles from Chinese brands, priced at below $40,000, will further boost EV sales in coming months.

The Federal Government’s FBT waiver, combined with State-based incentives of between $3000 and $6000, has had a profound effect on EV demand.

Under the new rules, monthly repayments for a novated lease on a $70,000 electric vehicle are lower than a petrol vehicle costing roughly $45,000.

The spectacular growth in sales of Chinese cars continues. Chinese car sales were up by 158 per cent in June, while year-to-date sales are almost double the same period last year.

The Toyota HiLux was the top selling car in June. Picture: Thomas Wielecki.

The Chinese have taken advantage of the decision by mainstream Japanese and Korean brands to raise prices and drop cheaper models from their ranges.

Aided by bountiful supply, they have also been able to win over buyers not prepared to wait months for their car to be delivered.

Sales growth was stronger in Victoria, Western Australia and Queensland than New South Wales, where sales grew by only 15 per cent.

Toyota led the market in June with 20,948 vehicles sold, followed by Mazda (9706), Hyundai (8215), Ford (7753) and Kia (7551).

Originally published as VFACTS figures show car sales soared in June