Let's Go Shopping for a New Car

SYDNEY -- While Australian consumers might still be reluctant to spend in stores, they are driving into motor dealerships across the country in droves. New-car sales are up 9% compared to last year, with 822,674 vehicles sold since the start of this year, according to the Federal Chamber of Automotive Industries.

SUV sales continue to eat into the demand for passenger cars, with sales of SUVs rising 20% in September compared with August, while passenger-vehicle sales rose just 3%. Large-vehicle sales continue to fall, and the Holden Commodore has been relegated to fifth behind the Mazda3, Toyota Hilux, Hyundai i30, and the Toyota Corolla. The Commodore was Australia's most popular car for 15 consecutive years until 2011, when it was knocked off by the Mazda3. Ford doesn't even have one vehicle in the top-10-selling cars in September.

The growth in new-car sales is good news for several companies associated with the motor vehicle industry, including bullbar and canopy maker ARB Corporation (ASX: ARP.AX) and Super Retail Group (ASX: SUL.AX), with its Super Cheap Auto Accessories stores. Metcash Limited (ASX: MTS.AX) should also reap some of the benefits with its 75% ownership of Automotive Brands, a company with Autobarn retail stores, Autopro dealership groups, and a car parts division.

The figures have been spurred by heavy discounting, with several companies facing declining sales, offering 0% finance as they try to turn flagging fortunes around.

Ford, General Motors Holden, and Toyota, which are under pressure by the high Australian dollar and rising costs, recently complained about the Australian Customs Service suggestion that imported steel should attract a tariff of up to 15.45%. The tariff is designed to protect Australia's biggest steel maker, BlueScope Steel Limited (ASX: BSL.AX), but makes it more difficult for local manufacturers to compete against imported vehicles.

If you are looking for ASX investing ideas, look no further than our brand new free report: "The Motley Fool's Top Stock for 2012-13." In this free report, Investment Analyst Scott Phillips names his top pick for 2012 and 2013 -- and beyond. Click here now to find out the name of this small but growing software company with huge potential. But hurry -- the report is free for only a limited period of time.

More reading

Motley Fool writer/analyst Mike King doesn't own shares in any stocks mentioned. The Motley Fool has a disclosure policyThe Motley Fool's purpose is to help the world invest, better. Take Stock is The Motley Fool's free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. Click here now to request your free subscription, while it's still available. This article contains general investment advice only (under AFSL 400691). Authorized by Bruce Jackson.


Read/Post Comments (0) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2045300, ~/Articles/ArticleHandler.aspx, 11/26/2014 10:07:10 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement