Auto loans on the rise as car sales explode in Australia
After months of containment thanks to COVID-19 restrictions, more Australians than before are determined to hit the road with a new set of wheels.
The last Australian Bureau of Statistics (ABS) figures show that car loan commitments increased 4.7% in May 2021 (seasonally adjusted data). This saw the total value of new loan commitments for May 2021 rise to $ 1.296 billion.
Between February 2020 and April 2020, the value of new vehicle commitments increased from $ 1.151 billion to $ 629 million. This is not surprising as it reflects the impact of COVID-19 on the Australian economy.
The value of new loan commitments seen in May 2021 may reflect Australia’s continued economic recovery and growth. While still down from its March 2016 high of $ 1.355 billion, it is closing the gap.
Meanwhile, the last digits of the Federal Chamber of Automotive Industries (FCAI) posted solid results for new vehicle sales in June. 110,664 sales were recorded in the month alone, an increase of 0.4% year-over-year.
The first six months of 2021 also reflected Australia’s renewed love affair with their four-wheelers, as sales results rose 28.3% compared to the same period in 2020. Vehicle sales nine reached 567,468 in the first six months of 2021, compared to 442,415 for the first six months of 2020.
Toyota was the market leader in June (21,076 sales), followed by Mazda (12,225 sales), Ford (8,456 sales), Kia (7,890 sales) and Hyundai (7,357 sales).
For the best-selling vehicles in June, the Ford Ranger came out on top (6,058), followed by the Toyota HiLux (5,412), the Isuzu Ute D-Max (3,167), the Mazda CX- 5 (3,018) and the Kia. Cerato (2,711).
Federal Chamber of Automotive Industries chief executive Tony Weber said June’s result was “consistent with the buying habits usually recorded at this time of year.”
“Expectations of a good result in June had remained high given the traditional year-end demand from commercial and private buyers driven by government incentives, such as the extension of depreciation announced in the federal budget coupled with intensive marketing activity for vehicle brands, ” he said.
“Although some states were forced to block COVID-19 around the end of June, acquiring a new vehicle remains a popular option for buyers in all market segments. “
“The delivery issues caused by shortages of microprocessors and bottlenecks in the supply chain are not yet fully resolved, however, all parties continue to find ways to meet high customer demand across the board. sectors ” he said.
Are you planning to take out a car loan to buy your new wheelset? It’s not just the interest rate to consider. Take stock of what fees, if any, the vendor may charge, as well as whether they offer features like the ability to make additional refunds or offer a re-withdrawal facility.