One look at VFACTS new car sales figures year-to-date (YTD) for Australia confirms the two-speed economy and underscores the problems for Government and the Reserve Bank in getting the right policy settings to deal with it.
And it's not only a problem for the Federal Government.
With the exception of Western Australia which is riding the resources wave top to bottom, and Tasmania which is stuck in reverse, most states with the exception of Victoria are experiencing two speed economies within their borders.
Like Queensland: riding the resources boom north of the mythical 'Brisbane Line', and below it a once-booming tourism industry blackened and bruised by a rampant dollar (held high, ironically, by a booming resources sector).
For policy makers, it's like trying to ride two horses: one bolting, the other running on dead legs.
What policy levers do you pull to deal with such disparate economic performance across industry sectors within the one broader economy? And where the scale of the boom in one sector is hurting nearly all others - manufacturing, retail and tourism in particular.
The confused and conflicting positions of commentators and governments on how to manage it, both state and federal, is matched by flagging consumer confidence and a growing sentiment - not currently rooted in reality - that the economy is in recession.
So we have new car sales in Western Australia up by 10.0 percent YTD, up by 7.5 percent YTD in Queensland, but down by 12.3 percent YTD in Tasmania, and up by just 3.9 percent YTD in Victoria, and 4.1 percent YTD in NSW.
It is just as patchy, though a little less dramatic, in April sales.
Given the negative consumer sentiment still eating its way through the economy however, that the industry is up at all is little short of remarkable.
But having studied VFACTS sales results for the better part of 15 years, it is difficult to recall a period with such unpredictable results and such unusual statistical 'noise'.
For some brands, their marketing departments will be scratching their heads trying to make sense of what's happening in 2012 and the fickle up-and-down sales performance of some models.
Aside from SUVS, small ones in the main, riding a wave of sales as the 'new family wagon' of the 21st century, everything else is an unpredictable mish-mash.
Here, for instance, is the top 20 list of vehicle sales across all sectors for April.
- Toyota HiLux (4X2 and 4X4): 3565 sales
- Mazda3: 3005 sales
- Toyota Corolla: 2573 sales
- Holden Cruze: 2315 sales
- Holden Commodore: 2258 sales
- Hyundai i30: 2147 sales
- Toyota Prado: 1725 sales
- Toyota Camry: 1602 sales
- Nissan Navara (4X2 and 4X4): 1590 sales
- Mitsubishi Triton (4X2 and 4X4): 1482 sales
- Mazda CX-5: 1413 sales
- Toyota Yaris: 1380 sales
- Mazda2: 1305 sales
- Ford Focus: 1105 Sales
- Ford Territory: 1076 sales
- Toyota Kluger: 1047 sales
- Ford Falcon: 1009 sales
- Subaru Forester: 989 sales
- Honda Jazz: 972 sales
- Hyundai iX35: 971 sales
Who would ever have thought that in this country we would see the Falcon sitting at number 17 on such a list?
And besides the astonishing performance of the versatile 'recreation and work' utes, like the HiLux, Navara and Triton, Mazda will be doing cartwheels over the performance of its CX-5 in just its second full month of sales.
Commodore is now bested by its Adelaide production partner, the Cruze, and both Falcon and Territory are bested by the Focus (strange days indeed).
Of the vehicle segments, SUV is up 27.8 percent in April, light commercial (mostly utes) is up 7.4 percent, passenger sales are down 2.5 percent.
And it's not only families buying SUVs. Business sector sales are up 28.3 percent, nearly matching the private growth in sales of 31.5 percent. And, remarkably, rental growth in SUV sales YTD is up an astonishing 108 percent.
Look a little deeper and you'll find big Landcruiser sales up 26.3 percent in April, Nissan Patrol up 32.2 percent, Prado up 89.6 percent for April, and theLexus LX up 166.7 percent.
This double and triple digit growth was achieved while Mercedes M and G-Classdeclined, Land Rover Discovery and Range Rover declined, and BMW X5 up 9.5 percent for the month (a good result in any other market, but with nothing like the growth of the big Japanese 'trucks').
Is that a booming resources sector at work? It's guesswork, VFACTS does not provide the sales granularity necessary to make that leap, but the outback is awash with big Toyota and Nissan 4X4 wagons.
Nielsen's first quarter survey (February 10-27) of 31,000 online consumers in 56 countries found that "Australians reported the second most significant drop in confidence after Poland with a decrease of eight index points to 95. Contrastingly, global consumer confidence increased five index points to 94 in the first quarter of 2012".
In that survey, more than one third (36 percent) of Australian consumers believed the country was in recession.
Nielsen also isolated high interest rates as a key reason for declining consumer sentiment.
"While these rates may be appropriate for the mining industry, they are not suitable for the rest of the country’s economy, particularly the retail sector which continues to struggle, fuelling the notion of a polarised, two-speed economy,” Chris Percy, Managing Director, Nielsen Pacific, said.
On that score, this week's rate reduction of 50 basis points announced by Reserve Bank Governor Glenn Stevens would seem to be overdue.
Source : www.themotorreport.com.au
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