Australian economy remains wary as automobile industry endures slump

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Australian economy remains wary as automobile industry endures slump

Australian automobile sales (for new automobiles) in Australia slipped for September, in what was their 18th straight month of fall. According to a Reuters’ report, the slip in the automobile sales came despite consecutive cutting down in the interest rates by the country’s banks in the months of June and July.

The Federal Chamber of Automotive Industries’ (FCAI) data showed that September sales of new automobiles fell sharply to around 88,181 cars or around seven per cent for the same month in 2018. In the nine-month period from January to September 2019, automobile sales in the nation had fallen by as much as eight per cent for the same nine-month time-frame, a year ago.

The Reserve Bank of Australia (RBA), the country’s central bank had trimmed the rates in a bid to up the morale of the consumers. Reportedly, cutting down in the mortgage rates has helped stabilise the housing sector.

However, FCAI Chief Executive Officer (CEO) Tony Weber said that the sliding automobile sales were in line with the rest of the indicators of the Australian economy. Weber pointed out that the way loans were offered to the end consumers also made it difficult for them to contemplate in taking one up.

He noted, “Of particular concern to the industry is the restrictive regulatory lending conditions currently facing consumers”. Despite the slump in sales, Japanese carmakers Toyota, Mitsubishi and Mazda retained the majority market share in Australia with 17.2 per cent, 10.2 per cent, and 9.3 per cent respectively.