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Australia - Auto Sales Showing Low Mileage, Need Efficient Fuel
Oct 24, 2008

New vehicle sales in Australia dropped huge 10.1% in August 2008 due to weak demand, rising petrol prices, high interest rates and volatility in the financial market.

The Australian Federal Chamber of Automotive industries said that the new vehicle sales in the country fell by 10.1% in seasonally adjusted terms during August 2008 over the previous month, as reported by
Forbes.

The automobile sales plunged 7.9% in original terms during August 2008 against 12.3% fall in the corresponding month last year. The industry sold a total of 77,324 vehicles, including cars, trucks and buses in August 2008. While the vehicle sales from January 2008 to August 2008 were running higher by 0.7% against the same period a year ago, the sales trend was showing a sharp fall in the growth rate.

The Australian automobile industry sales declined primarily due to weak demand for vehicles in the country. Due to rising petrol prices, people in Australia cancelled their plans of purchasing vehicles, pushing the demand for automobile down. Moreover, hike in interest rates stopped people to invest in the automobile industry.

In addition, the automobile industry suffered from low consumer confidence and volatility in the financial market that seriously hit the vehicle sales. Slow economic growth is also partly responsible for low sales in Australia as it dampened the demand for vehicles.

Australia represents one of the most competitive and open automobile markets, but it is presently facing a number of challenges that are hampering its growth, such as continuous appreciation of the Australian dollar, uncertain economic times, changing market segmentation and pressure to comply with environment improvement norms.

According to a Research Analyst at
RNCOS, “The Australian automobile industry sales slumped due to several reasons, rising petrol prices being one of them. Being the largest manufacturing industry in the country, automobile industry contributes considerably to the development of economy, but the current decline will affect the economic growth as its share in the annual GDP would be less. To answer the problem, the manufacturers should launch fuel-efficient vehicles to reduce the burden on consumers’ pockets and to increase the sales in future. They should also focus on small cars as their sales are rising.”

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