New car sales expected to level off in 2018 after posting a fourth annual record
The Motor Industry Association expects new car sales will plateau this year after posting yet another annual record in 2017 due to cheap imports, an expanding population and record tourist numbers.
New vehicle registrations rose 9 percent to 159,187 in calendar 2017, the fourth year in a row of reporting a new all-time high, MIA figures show. Of that, passenger vehicles increased 5.8 percent to 108,616 and commercial vehicles advanced 16 percent to 51,508.
MIA chief executive David Crawford said the strength in New Zealand's tourism sector underpinned a 9.6 percent increase in December registrations, as rental operators expanded their fleets to meet demand from international visitors, and has previously acknowledged optimism about the economy and an expanding population as supporting the auto trade. While that's expected to maintain the current level of activity, Crawford isn't expecting another record year in 2018.
"Distributor expectations for 2018 indicate maintenance of current levels of activity, but further steady growth in the new vehicle sector above 2017 outturn is not expected," he said in a statement.
That echoes the cautious approach taken by NZX-listed distributor Colonial Motor Co, which told shareholders last year that new registrations didn't separate out franchisors getting rid of old inventory, which was typically unprofitable.
The strength of New Zealand's auto sector has attracted interest from Australian firms, with ASX-listed Automotive Holdings Group yesterday announcing the acquisition of two dealerships in Manukau for $7.5 million, while Bapcor last year bought Hellaby Holdings for $352 million, primarily for its auto division. Government figures show motor vehicle and parts retail sales rose 9.4 percent to $12.43 billion in the March 2017 year, accounting for about 14 percent of all retail spending.
Today's MIA figures show Toyota remained the market leader with 20 percent of all new registrations, followed by Ford with 11 percent and Holden with 9 percent. Toyota topped both passenger and commercial segments with 19 percent and 22 percent of the respective markets. Mazda was the second most popular passenger vehicle with a 9 percent share, just eclipsing Holden also at 9 percent.
Ford was the second most popular commercial vehicle with a 20 percent share, followed by Holden at 9 percent.