Australian new vehicle sales have experienced a significant drop with a total of only 88,157 passenger, SUV and commercial vehicles being sold last month. As indicated by the most recent VFACTS report, August vehicle sales are down by 5.5% on the previous year and have declined by 1.9% since July 2014. These statistics mark the biggest slowdown in the industry since the 2007-2008 Global Financial Crisis, with six of the top ten car manufacturers experiencing an average decline of 15.0% when compared to August of last year.

This month, the leading car manufacturer, Toyota, experienced a 11.9% drop in their new car sales figures, reaching a well below average total of 15,638 – this figure is 2,120 units lower than it was in August of last year. Similarly Holden’s sales figures, which until this month were making a steady recovery throughout the year, dropped by 18.6% to a total of 8,635 units. However, the biggest shock of all came from Mazda, with the manufacturer’s new car sales decreasing by 23.4% with only 7,529 units being sold in the past month.

Looking into the most popular car models, the Toyota Corolla maintained its title of top selling vehicle of the month, producing 3,247 of sales during the August 2014 period. Closely following behind was the Mazda 3 which made up 3,124 of total sales, and the Toyota Hilux, which was responsible for 2,918 new car sales. The Hyundai i30 and the Holden Commodore generated 2,651 and 2,344 of last month’s sales, respectively.

So, what could have brought about this drastic slowdown in car sales when car affordability is at a 38-year high? The Australian Bureau of Statistics indicates that while the price of vehicles may be at a 20-year low, the rate of unemployment has risen by 0.7% in the past year, from 5.7% to 6.4% - that’s an additional 109,000 Australians who are now in the unemployed market. Additionally, with changes being made to the Federal Budget, there has been an altered sense of security among buyers which can be directly linked to changing consumer confidence levels and purchasing behaviours.

While passenger and commercial vehicle purchases both weakened last month, there were also big winners in the luxury vehicle market. Maserati sold 46 vehicles in the month of August, creating a staggering growth of 475.0%, while Porsche grew its total sales by 105.6% as a result of 74 vehicles across Australia. Similarly, BMW had an impressive month of sales, rising 21.3% with 2008 car sales, and Audi sold 1,577 units creating a 21.2% increase in their total sales for the month.

As in previous months, SUV vehicles continued to grow in sales volume when compared to August 2013, increasing by 0.1% and 0.5%, respectively. The FCAI’s chief executive, Tony Weber, made a statement addressing the rise of SUV purchases in 2014.
“SUVs and light commercial vehicles were a popular choice for private buyers in August, with private purchases in these segments rising 5.6 and 8.9%, respectively; compared to August 2013… Government purchases of SUVs increased 29.6%,” he said.

Check back with us next month when we deliver the new car sales results for September 2014. In the meantime, you can read our recent article relating to the rising trend of SUV sales in Australia by clicking here.