A solid month in November for many of the world’s major car markets, including Australia, but those economies where some sort of tax or purchase assistance is in place did a lot better than those without.
Early reports from China suggest sales surged, with General Motors in the US reporting that industry sales in China rose 93% in October from a year ago.
That’s a bit misleading (as are some other rises), because car sales were plunging a year ago as the global crunch and recession started rolling across the US, Europe and Asia.
China’s sales are being driven by government support (via tax rates) for small car purchases, as are the car markets in many countries, including Australia.
China is now the world’s biggest car market, with sales and production running at an annual rate of over 12 million units.
Solid increases were also reported from Europe, with Germany, Italy and France seeing rises as government programs supporting new car sales again underpinned the market.
Brazil also saw a big rise, but in the US, where impact of the cash for clunkers scheme has passed, it was another tough battle with sales flatlining .
Ford did well, as did Toyota and Hyundai, but General Motors struggled.
US sales in November look good only in comparison to poor figures from 2008 and were lower than October’s sales.
Overall industry US sales were essentially unchanged from year-ago results for the second month in a row and came in at a seasonally adjusted annual sales rate of 10.9 million vehicles, still 50% or more below the highs in 2006-2007.
In Australia another strong rise in sales as the remaining tax rebate for small business car purchasers saw a near 20% rise in sales in November.
The figures from Federal Chamber of Automotive Industries (FCAI) shows that 85,833 passenger cars, SUVs and commercial vehicles were sold in November 2009 – an increase of 19.9% (14,216 vehicles) compared to the same month last year.
That was also up 6% from November’s 80,813.
December’s sales result was the second month this year where sales have been ahead of the corresponding months of 2008.
Faced with the ending of the tax break this month, another strong sales result can be expected and that will mean that not only will sales beat November’s level and those of December last year, but the quarter will also be very, very strong.
But fears are now growing in some markets that with government schemes and assistance expiring, or being reduced, 2010 will see a sharp fall in sales, especially in the first half of the year.
For example German car groups are increasingly nervous that car sales could be down by 20%-25% or more over all of 2010 from this year’s very strong result.
New car registrations in Germany rose 20% in November to nearly 280,000 units, bringing the total for the first 11 months of the year to almost 3.6 million, up 25%.
Germany adopted a car scrappage scheme at the start of this year, extended it to a total cost of 5 billion euros.
It ran out in September but it will have boosted sales to 3.8 million units by the end of this month, compared with 3.1 million sold in 2008.
Now the industry is forecasting a 25% drop next year to around 2.75 million and 3.0 million units, or under the 2008 figure.
That will mean further pressure on employment, production and the overall economy.
France and Italy share similar fears.
In France, car sales rose 48.4% in November and 7.6% in the first 11 months of this year.
Italy’s Transport Ministry said new car registrations rose 31.25% to 182,976 units in November.
In Spain, which introduced its scrapping incentive scheme in May, car sales rose 37.3% last month.
The European solution for 2010; sell more to China.
But the Americans and Asian groups are there before them and only Volkswagen from Germany has a solid presence in China.
With Australian interest rates on the rise, and going to rise further, it’s also a concern for the local industry, but for the moment it is happy with the way the market has been dragged upwards in recent months.
“This is an extraordinary result that provides further evidence that the market and the broader Australian economy are showing signs of recovery,” FCAI Chief Executive Andrew McKellar said in a statement.
“The exceptional November figures could not have been achieved without the Federal Government’s small business tax break.
“Business sales increased an incredible 35.4 per cent during the month; spurred on by the substantial incentives available until the end of the year,” Mr McKellar said.
The rise follows a similar performance in June when a second tax break (for medium sized companies) expired. 102,847 passenger cars, SUVs and commercial vehicles were sold in June 2009, according to FCAI figures.
This is the third highest selling month on record, following 106,541 in June 2008 and 105,097 in June 2007.
It holds out the prospect that this month will be another big month, possibly as large as June.
The local car industry didn’t fare as well as the imports, with sales of locally-built vehicles increasing at around half the 20% rise in sales.
Sales of the Holden Commodore fell 10%, while Toyota’s Aurion were down 11%. Falcon and Camry (Toyota) sales rose however to offset the falls by the Commodore and Aurion.
The fall in fuel costs, because of weaker
