New car buyers will be inundated with cut-price deals over the next two months, after a disastrous October left dealers with too much stock and not enough orders.
Commercial vehicles appeared to remain immune to the downturn, with sales up 7.9 per cent, reflecting a gap between business and consumer confidence that industry experts are tipping to close in coming months.
In contrast to commercial vehicle sales, car sales were down 13.8 per cent and off-roader sales were down 19.1 per cent.
Commodore sales dropped 14.2 per cent, while the new Falcon could attract only 2747 buyers and slipped to 4th place behind the HiLux, Commodore and Corolla.
Most prestige and luxury brands also suffered from the sharemarket crash, with Porsche sales down 39.6 per cent, Ferrari down 33 per cent, Mercedes-Benz down 42.6 per cent and Lexus down 62.2 per cent.
The head of sales and marketing for market leader Toyota, David Buttner, predicts cut-throat competition in the industry over the next two months as tighter credit and the economic slowdown take effect.
“November and December will be the most competitive period in the industry for some time. Everybody has plenty of stock and the last thing anyone wants to do is to carry that into next year. It’s a great time for consumers,” he says.
But this year, the pressure is even greater because the industry has ordered too much stock on the back of record sales in the first half of the year.
Buttner believes the recent cut in interest rates won’t have any real effect on consumer demand in the tail end of the year, leaving car makers to fight for their slice of a much smaller pie.
After earlier this year predicting another record for the new car market, Buttner now believes sales “will just scrape in over the million mark”. The company has downgraded its 2008 forecast by 55,000 vehicles in recent months and Buttner is cautious forecasting any growth next year.
He says business confidence, particularly in the mining and rural sectors, has remained strong in Australia, with Toyota’s sales of commercial vehicles up 18 per cent.
Despite the drop in sales, the Australian car industry is holding up relatively well in comparison with its United States counterpart, where sales tumbled to their lowest level in more than 25 years.
General Motors’ sales were down 45 per cent on October last year, while Chrysler sales were down 35 per cent, Ford was down 30 per cent and Toyota dropped 23 per cent.
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