New car sales break January record
THE record-breaking strength of new vehicle sales has rolled into 2015, with more than 11,000 sold in January for the first time.
But the weakening New Zealand dollar will eventually pump up car prices, leading to a ‘‘plateau’’ in car sales, an economist says.
Motor Industry Association statistics showed that 9010 new passenger vehicles and 2657 commercial vehicles were sold during January, both records for the month.
Chief executive David Crawford said the sales had outperformed the industry’s expectations, as some expected a slowdown after last year’s record year.
In total, 127,179 new vehicles were registered last year, up 12 per cent on a strong 2013, thanks mainly to an improving economy and a strong dollar.
But Crawford said businesses and consumers had continued to ‘‘loosen their purse strings’’ in the first month of this year.
‘‘New vehicle sales for 2015 have started where they left off in 2014, with the outlook for 2015 remaining very positive,’’ he said.
Brendan Foot Motors dealer principal Matthew Foot said January had been a very busy month for both new and used car sales.
‘‘I don’t know what’s triggering the confidence, but I think, obviously a bit of fine weather helps, there seems to be people back in the city a bit earlier than normal, a lot back.
‘‘The strong New Zealand dollar and the prices of the cars is really triggering a lot of sales.’’
of
the
decision-makers
are
The recent fall in the kiwi dollar to about US73c would take a while to push car prices higher, Foot said.
But he
believed
Wellington seemed to be ‘‘turning a corner’’, with confidence back up, measured by the number of commercial vehicles he had sold recently.
Infometrics senior economist Benje Patterson said it had been expecting car sales would plateau in 2015 for some time.
‘‘One of the major reasons for that was the New Zealand dollar will start coming off some of its peaks which slowly puts some upward pressure on prices.
‘‘And the fact that a lot of people have already taken the opportunity over the past couple of years to replace vehicles that were ageing.’’
Patterson said it had not been surprising to see a strong set of January sales, however, because the yen had weakened substantially at the end of last year.
This had meant dealers had been able to import stock at favourable prices, which had continued to flow into cheaper cars in the early stages of this year.
But following a near 10 per cent appreciation, the New Zealand dollar had recently crashed against the yen, he said.
‘‘That window to lock in extremely favourable pricing has closed again.
‘‘It will be hard to say when that flows through to what’s happening on the ground, but it is certainly going to.’’
The near 50 cent a litre drop in petrol prices since October had probably fuelled demand for larger vehicles at the same time, Patterson said, after small cars gained significant market share in recent years.
Toyota held the highest market share during January, accounting for 21 per cent of all vehicles sold.
The Toyota Corolla remained the country’s most popular car, with 792 sales during January.
But Ford continued its strength
Matthew Foot in the commercial vehicle market, pulling 19 per cent of all sales, just 36 ahead of Toyota.
The Ford Ranger was the top selling commercial model, with 417 new units sold last month.
Sports utility vehicles (SUVs) are the most popular segment overall, making up 32 per cent of all new vehicles sold.