23/04/2009 - 13:39

WA commercial vehicle sales pick up

23/04/2009 - 13:39

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The federal government's business investment stimulus is finally paying dividends with sales of new commercial vehicles in Western Australia rising 6 per cent in March, new figures show.

The federal government's business investment stimulus is finally paying dividends with sales of new commercial vehicles in Western Australia rising 6 per cent in March, new figures show.

Latest data from the Australian Bureau of Statistics show sales of "other" vehicles, excluding passenger and sports utility vehicles, up from 1,947 units in February to 2,061 in March, seasonally adjusted.

The upward trend was also mirrored in the national figures with sales for new commercial vehicles rising 3.1 per cent from a seasonally adjusted 15,169 to 15,640 units.

The increase followed a 10.8 per cent decline during the first two months of 2009.

CommSec economist Savanth Sebastian said the government stimulus of a 30 per cent tax rebate on business investment is finally paying dividends.

"Sales of commercial trucks, van and buses have picked up marginally over March, a trend that is likely to continue in the lead up to the June 30 deadline, Mr Sebastian said.

"In fact sales of "business vehicles" would have noted a much more significant pickup if the government had a majority in both houses of parliament.

"There is no doubt some businesses are lacking confidence in the governments ability to pass the tax rebate especially after the defeat of the Alco pops bill."

Meantime, overall new vehicle sales in Western Australia were down 3.8 per cent from 8,305 to 7,986 units, seasonally adjusted.

In comparison to March 2008, sales plummeted 24.5 per cent.

Sales of passenger vehicles in March 2009 were down 8.2 per cent to a seasonally adjusted 4,183 units while 1,743 sports utility vehicles were sold during the month, down 3.3 per cent.

Nationally, sales of new vehicles fell to a six-year low in March as the economic slowdown continued to put the brakes on demand.

Vehicle sales fell by 3.2 per cent, seasonally adjusted, after a 4 per cent decline in February.

In March, 70,279 new vehicles were sold, the lowest number since February 2003.

New vehicle sales have fallen for every month except December over the past nine months, and were down 22.6 per cent in March compared with the same month in 2008.

Mr Sebastian said the 20.2 per cent fall in the trend growth of annual car sales pointed to the deteriorating health of the car industry.

"In trend terms, it is the weakest annual growth rate since records were maintained 14 years ago," Mr Sebastian said.

Passenger car sales fell 5.4 per cent in March to its lowest number since June 2000 when a mini-slump in car purchases occurred before the introduction of the goods and services tax that lowered vehicle prices.

Purchases of four wheel drives were down 2.9 per cent in March to its lowest number since August 2006.

Australian consumers had become very conservative as gloom hung over the economy, Mr Sebastian said.

"The conservative attitude is going to stay over this year," he said.

"We had confirmation from the Reserve Bank (of Australia) that we will go into recession and the IMF (International Monetary Fund) is even more pessimistic about growth forecasts suggests things are not looking good for car dealers and not likely to improve in this environment."

Prices for new cars were cheaper by an average 1.9 per cent in the March quarter than 12 months ago, ABS data showed on Wednesday.

"Car affordability is the best in almost 20 years," Mr Sebastian said.

"Prices continue to fall, but consumers are prepared to use their old cars a while longer."

 

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