New Zealand witnesses 6.0% y/y growth in July
IHS Markit perspective
- Implications: Despite slow economic growth, a weakening currency, rising fuel prices, and a drop in overall business confidence, new vehicle registrations in New Zealand remained strong during the month.
- Outlook: IHS Markit forecasts that light-vehicle sales in New Zealand will edge up by 0.2% y/y to 155,742 units in 2018.
New vehicle registrations in New Zealand grew 6.0% y/y to 12,324 units during July, according to data released by the country's Motor Industry Association (MIA). Passenger vehicle registrations during the month went up by 5.7% y/y to 8,041 units, while commercial vehicle (CV) registrations stood at 4,283 units, up 6.4% y/y. Toyota remained the overall market leader in July with a 17.0% market share, followed by Ford with 10.0% and Mazda with 8.0%. The Ford Ranger was the best-selling vehicle during the month with sales of 674 units, followed by the Toyota Hilux (658 units) and the Holden Colorado (408 units). "Despite there being several worrying signs the NZ economy is not as strong as it has been, combined with a significant drop in overall business confidence, new vehicle sales have for the time being held steady," said MIA chief executive David Crawford. In the YTD, new vehicle registrations in the country stand at 92,333 units (up 1.8% y/y), split between passenger vehicle registrations of 61,060 units (up 0.9% y/y) and CV registrations of 31,273 units (up 3.5% y/y).
Outlook and implications
Last month was the second strongest July ever for New Zealand's vehicle market, according to the MIA (the strongest was in 1984 with 13,983 registrations). Although sales were strong last month, New Zealand's new vehicle market grew only moderately in the January-July period. This moderate growth during the period can be attributed to slowing economic growth, a weakening currency, rising fuel prices, and a high base of comparison. These factors will keep New Zealand's new vehicle market in check in 2018. IHS Markit forecasts that light-vehicle sales in New Zealand will come in at 155,742 units in 2018, up 0.2% y/y. Sales in the country will be led by the SUV body type with 65,430 units, up 6.2% y/y, giving this segment a market share of 42.0% in 2018. Sales in this category will be led by the Mazda CX-5 with 4,581 units, up 41.5% y/y. Pick-ups will follow as the second most popular body type in the country this year: sales in this segment are expected to rise by 11.8% y/y to 41,383 units, giving it a market share of 26.6%. The Ford Ranger will be the segment leader with sales of 10,575 units (up 12.1% y/y). During the year, hatchbacks will be the third most popular body type in the country with a market share of 17.8% and sales of 27,662 units (down 9.1% y/y). The Toyota Auris will lead the hatchback segment with sales of 4,330 units, although this does represent a decline of 32.4% y/y, mainly due to a high base of comparison and strong competition in the segment.
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