New vehicle sales in Western Australia followed the national trend and picked up more than 3 per cent in May, confirming confidence is on the mend, economists say.
New vehicle sales in Western Australia followed the national trend and picked up more than 3 per cent in May, confirming confidence is on the mend, economists say.
Total vehicle sales in WA rose 3.1 per cent from April's seasonally adjusted 7,996 units to 8,244 units, according to latest data from the Australian Bureau of Statistics.
Sales of passenger vehicles in the state were steady with 4,305 sold in May while the sale of sports utility vehicles climbed 3 per cent to a seasonally adjusted 1,837 units.
Nationally, new motor vehicle sales rose by 5.4 per cent, seasonally adjusted, to 75,472 units in May, from 71,626 units in April.
It was the second consecutive monthly rise in new motor vehicle sales, which grew a modest 1.7 per cent in April, and the biggest percentage point jump in sales since January 2005.
Vehicle sales contracted between January and March.
"This is the largest monthly gain since early 2008, and also further builds on gains achieved in April, creating the first two month consecutive gain in this series for quite some time," Kinetic Securities Chief economist Clifford Bennett said in a statement.
"All of the individual states were positive, with the exception of the ACT.
"The Kinetic economic thesis that Australia would be last in and first out of the recessionary period, is again encouraged by the emerging data stream."
Victoria was hungriest for vehicles in May, with sales rising 9.6 per cent, seasonally adjusted, to 20,205 new cars, up from 18,439 in April.
South Australian sales rose 7.4 per cent, Tasmania's 5.5 per cent and the Northern Territory's climbed 4.6 per cent.
The number of new motor vehicle sales in NSW grew by 4 per cent and Queensland rose by 3.5 per cent.
The ACT was the only area to record a decline, with sales falling 2.4 per cent.
NAB senior economist David De Garis said the jump in vehicle sales was positive with a modest 2.9 per cent seasonally adjusted rise in passenger vehicles being offset by a 6.4 per cent rise in the sales of Sports Utility Vehicles (SUVs).
Sales of SUVs rose to 15,241 nationwide, or 20.2 per cent of total vehicle sales, marginally lower than the record 20.4 per cent set in October 2007.
"These data are a modest net positive for final domestic demand in the June quarter; sales of passenger motor vehicles are still, in April/May, down on the March quarter average," Mr De Garis said in a statement.
"But this has been more than offset by a rebound in SUV and other vehicle sales for example motor bikes, tractors, buses etc so that vehicle sales are on track to make a modest contribution to business investment and domestic demand in (the second quarter of 2009).
"Its hard to escape the conclusion that sales have been supported of late by an overall pick up in consumer confidence, a rebound in business confidence and some support from the continuing effects from the small business bonus tax deduction for investment depreciation."
CommSec economist Craig James said the improvement in car sales added further weight to the economic recovery.
"However it is still early days with employment likely to be the key dictator on how quickly the Australian economy gets back on an expansionary path," Mr James said.
The latest ABS figures show the jobless rate hit 5.7 per cent in May, with Treasury tipping it to peak to 8.5 per cent in 2010/11.
