Over the last two months, the number of Australians planning to buy a new car in the next four years has dropped by almost 13% according to new data by Roy Morgan Research.
Since hitting an all-time high of close to 2.5 million potential new car buyers in May 2014, the market has decreased to 2.17 million Australians — the lowest result since November 2012.
In the short term, the number of people intending to buy a new car in the next 12 months has also declined and now sits at 608,000 – 14,000 below the long-term average of 622,000 and well down on May’s result of 721,000.
At a brand level, almost all major brands have lost share since May, with only KIA, Subaru, Hyundai, Honda and BMW bucking the trend.
Jordan Pakes, industry director – automotive, Roy Morgan Research, says: “Since hitting a record high of close to 2.5 million potential new car buyers in May this year, the industry has taken a substantial hit, with more than 300,000 people deciding to exit the market.
“With the average new car buyer looking to spend around $34,500 on their next car, this equates to a loss of almost $10.4 billion in potential revenue for the auto industry, unless the market improves soon.
“Given that total new vehicle sales for the industry are already down for the year to date according to VFACTS, these latest car-buying intention results would be of concern,” Pakes says.
According to Pakes, the recent decrease in car-buying intention coincides with a strong decline in consumer and business confidence since the May federal budget announcement.
The main factor influencing this decline in consumer confidence is the growing proportion of Australians who expect to be worse off this time next year.
“In addition to the local economic issues worrying many Australians, there have also been a number of major international events such as the unstable situation in the Ukraine (resulting in the downing of MH17) that are also adversely impacting on consumer certainty,” Pakes adds.
The data shows that, while the number of potential car buyers has declined across all seven ‘helix’ communities (link here) the most marked decreases have occurred among the ‘Getting By’, ‘Today’s Families’ and ‘Battlers’ communities.
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