Car Talk - Uncertainty creating challenges for new car industry.
By Jack Biddle
With so much uncertainty in the market currently, it’s little wonder new vehicle registrations overall are at best, stagnating.
Commenting on the recently released September results, Motor Industry Association Chief Executive Aimee Wiley says that new vehicle registrations remain soft at 10,909 units.
“September’s result is likely caused by both tougher economic conditions and continued uncertainty for the future of the Clean Car Discount scheme. Such uncertainty considerably impacted consumer demand in September. It comes as no surprise that product attracting rebates accelerated significantly, whilst demand for product attracting fees slumped”.
The September result is 26.7% lower than September 2022 (14,878 units), 20.0% lower than the monthly average for 2022 (13,641 units) and 12.4% lower than the monthly average so far for 2023.
For those looking to cash in on the Government rebate incentive and its uncertain future moving forward, the Battery Electric Vehicle (BEV) market segment share spiked to a huge 24.9% in September from an average of 13.9% since January 2022.
On the flip side, many of those potential commercial buyers hoping for the Government’s dirty diesel fee to be soon scrapped, looked like they have kept their hands in their pockets and are playing the wait and see game. The end result saw September registrations of 2,759 a staggering 35.5% lower than September 2022 (1,518 units). On a year-to-date basis, commercial registrations are 14.4 % down (5,312 units) compared to the same period in 2022.
So, what do punters looking to upgrade to a new set of wheels do in the short term?
Well for all the uncertainty around the future of rebates and fees, there is still one common denominator and that is the new vehicle industry itself which has enjoyed huge success across the board in recent years and will no doubt want that trend to continue.
When sales slow, the incentives to buy suddenly get rolled out to entice consumers into show rooms so we can expect to see some special deals offered, especially for the slow-moving segments.
When sales are on a roll, incentives can also help keep the ball rolling.
Regardless of who gets into the hot seat after the election, time is running out for owners of electric vehicles in regard to the exemption on paying any Road User Charges (RUC). The initial target was to keep the zero RUC policy until the national fleet had grown to around 2 percent. That figure is expected to be reached by around April 2024 at which time some form of RUC would apply. While it hasn’t been confirmed, current speculation is the fees will be similar if not the same as diesel where currently a fee of $76 per 1,000 kilometres applies for vehicles up to 3,500kg in weight.
Potential (and current) buyers of BEV’s will need to realize they will soon have to contribute to the upkeep of our roading network which is in dire need of some major upgrades and then also do the sums on future charging costs, RUC and other overall benefits versus downsides.
We are already seeing incentives being offered for some fully electric vehicles such as free chargers and discounted retail prices.
The new car market has definitely changed since the buying spree during the Covid-19 pandemic with lack of stock now not the issue it once was for many distributors. It’s back to reality for the industry and regardless of who is in charge of running the country, sales staff will no longer be just order takers, they will have to work hard for each potential sale regardless of motive power.
The winners could well be the consumers if they do their homework and purchase on needs and affordability. In the recent past there was the fear of missing out; now it’s more about the industry chasing the sale.
September sales summary:
Top 3 overall market leaders: Toyota with 24.2% market share (2,644units), followed by Ford with 10.3% (1,125 units) and Mitsubishi with 9.2% (1,006 units).
Top 3 Light passenger vehicle sales: Tesla Model Y (697 units), Toyota RAV4 (683 units), and Toyota Yaris Cross (316 units).
Top 3 Light commercial vehicle sales: Ford Ranger (605 units), Toyota Hilux (540 units) and Mitsubishi Triton (198 units).
BEVs: Tesla Model Y (697 units), MG 4 (250 units) and BYD Atto 3 (136 units).
Total Industry by motive power for the month of September: 2,067 BEVs, 768 PHEVs, 2,190 Hybrids and 5,884 ICE (internal combustion engines).
Segment leaders Passenger and SUV: Toyota retained the market lead with 23.1% market share (1,885 units) followed by Mitsubishi with 9.9% (808 units) and Tesla with 9.3% market share (760 units).
Segment leaders Commercial: Toyota took the market lead with 27.5% market share (759 units)
Caption: Future electric cars - concept cars and new releases.