New car sales rebound in June with EOFY boost

Easing restrictions and EOFY sales helped car sales stabilise in June, but the motor trade says its not out of the woods yet.

Car dealers saw a little more sunshine during June.

End of financial year sales and a slowly recovering economy with fewer COVID-19 restrictions have thrown a lifeline to the new car market after the industry saw its largest ever monthly decline in April.

New car sale figures for June published by the Federal Chamber of Automotive Industries showed that 110,234 vehicles were sold during the month – a decline of just more than 6 per cent on the number of vehicles sold in June 2019.

The drop follows declines of 35.3 per cent in May over the same period last year and 48.5 per cent in April the worst result for any month since the data series began in 1991.

A total of 442,415 vehicles have been sold this year to date, representing a 20.9 per cent decrease on the 554,446 vehicles sold in the first six months of 2019.

FCAI chief executive Tony Weber said the relative rebound in sales was driven by economic recovery, the easing of COVID-19 restrictions, EOFY sales and the expansion of the government’s instant asset write-off scheme.

“Some states have seen the easing of COVID-19 restrictions, and this has increased floor traffic through dealerships,” Mr Weber said.

“In addition, June is traditionally a very strong month for new vehicle sales. The end of financial year campaigns are well known, so it’s an excellent time for businesses and consumers to replace their vehicles.

“In June 2020, this has been reflected in strong results for business purchases, which have increased by 6.3 per cent on June 2019.

“The extension of the government’s instant asset write-off scheme has also been a positive influence.”

The impact of increased business spend is evident in the growth in sales of light commercial vehicles, which increased by 8.6 per cent compared to last month, and heavy commercial vehicles, which increased by 13.5 per cent.

Passenger vehicles recorded a decline of 26.1 per cent compared to last month while SUV sales shrank by 2.9 per cent.

Toyota was the best-selling brand in June, with 22,867 sales recorded, followed by Mazda with 9,420 sales and then Hyundai, with 7737 sales.

Four of the five top selling vehicles in June were utes, with the Toyota HiLux retaining its position as Australia’s most popular vehicle, with 6537 sales, up 21.1 per cent on June 2019,

The second most popular car was the Ford Ranger with 5329 sales, up 9.9 per cent, and then the Toyota Corolla with 3008 sales which represents a decline of 4.1 per cent.

Other car brands that performed better this June as compared to last include Audi, which sold 2020 new vehicles compared to 1098, and Lexus, which sold 1560 new vehicles, compared to last June’s figure of 970.

Mr Weber welcomed the signs of “green shoots” in the market, but noted that this June represented the 27th consecutive month of decreasing sales.

“Stimulus packages from the federal government, such as Job Keeper and Job Seeker, have helped to restore some consumer confidence and supported the small bounce back during June,” he said.

“However, there’s no doubt that the new vehicle industry in Australia is still under high pressure. We’re not out of the woods yet,”