New motor vehicle sales in Australia dropped 1.3 percent in July, stated the Australian Bureau of Statistics. This is a slowdown from June’s rise of 3.5 percent. Monthly sales in the country declined to 98,062, slipping from the all-time September 2015 high of 100,478. The sale of “other” vehicles has showed continued strength, which grew 1.8 percent on the previous month.
This is an upbeat sign for the Australian activity as the category is usually a good measure for activity in the business sector, noted St George Economics in a research report. The rise in July follows a 1.4 percent growth seen in June and brings sales in this category to the highest levels since February 2013, added St George Economics. On a year-on-year basis, sale of “other” vehicles rose 9.8 percent in July.
Meanwhile, passenger vehicles’ sales took a u-turn, declining 5.2 percent on sequential basis in July following a rise of 6.9 percent in June. Consumers chose sports utility vehicles instead as their vehicle of choice Sales of SUVs rose 1.5 percent in July.
Currently, interest rates are at historically low levels and there is a possibility they will drop further. The population in Territories and States keep on growing, while jobs continue to be generated throughout Australia. Given that consumer confidence is not damaged markedly, vehicle sales are expected to continue to be at current high levels, according to St George Economics.
