Baby, you can’t drive my car. Luxury car sales are booming, but why? Can we blame real estate agents, mortgage brokers, mortgage bankers, real estate lenders or conveyancing lawyers? Or perhaps stockbrokers, fund managers and bankers rewarding themselves with the creme de la creme of automotive magic after a stellar year in 2014?
While the wider car industry is having a record start to 2015, it’s nothing like the boom in the luxury segments. Car industry figures, out yesterday, show that total sales hit a record 105,000 in March. Leading off was Lamborghini which had a fabulous March, selling 17 cars, against just one a year ago. Porsches, which used to be driven by wealthy hairdressers, Macquarie bankers and real estate agents, are still very much the car of choice for the core buying group. Why else did we see an 87% jump in sales in March? From 173 to 323, and a 55% jump, to 915, in the March quarter (as compared to a year ago).
Ferraris are the ultimate wet dream for many men, and 17 buyers realised their desire in March, up from only five a year ago. In the March quarter, the prancing horse featured in the dreams of 47 buyers, up from 25, or a near doubling. Maseratis, a competitor for many males in the ultimate dream status also enjoyed a great March and quarter — sales more than trebled in March to 58 from 16, and from 43 to 138 in the quarter. We know the marque is the car of choice for at least two senior execs at Fairfax Media, CEO Greg Hywood and the up-and-coming Anthony Catalano.
Market leader Mercedes Benz recorded a more sedate 29.5% rise in March and 24.3% in the quarter — 8820 were sold in the first three months of the year, up from 7093. Merc sales have now moved decisively past Bimmers (BMW), which recorded a modest 14.3% rise in March sales to 2310 (from 2020). Lexus, the luxury brand from Toyota, also had a solid, BMW-like performance, with a 13.9% rise in sales in March and 5.3% for the quarter. The other German luxury marque, Audi, enjoyed a great March, with sales up 22% and 15% for the quarter. Even the grandest tank of them all, Rolls-Royce, enjoyed two sold last month, against one a year ago, and six so far this year, against five a year ago. — Glenn Dyer
May 5 now the day? No rate rise from the Reserve Bank, and now watch for the galahs in the pet shop (to use Paul Keating’s colourful phrase) to gather the May 5 RBA board meeting for the next bout of “rate cut looms” myopia. Some 17 of 30 local economists surveyed in the monthly Bloomberg survey got it right yesterday, so quite a few got it wrong, in fact. But the RBA’s decision to leave the cash rate steady at 2.25% was easily justified by the lack of data since the February cut showing any evidence of any impact. It’s not that the economic data isn’t bad, its just weak to middling, as it has been for much of the past two to three years, except for home construction. Take yesterday — while the ANZ job ads report recorded the first fall in nine months for online and newspaper job advertising in March, car sales for March hit an all-time high (and no, it wasn’t lower interest rates that were the sole factor, but the fall in petrol prices — just look at how sales of Sports Utility Vehicles are rising and sales of passenger cars falling). Retail sales also rose 0.7% in February (much better than forecast), with the January increase put at 0.5% instead of the first reported 0.4%. Cafes, restaurants and takeaways had another good month with a rise of 0.5% (seasonally adjusted). — Glenn Dyer
It’s petrol, not lower interest rates. Analysis of yesterday’s industry car sales data for March and for the March quarter clearly shows that petrol-powered cars are back in vogue after losing ground for years to diesel and hybrids — although the latter remain popular, especially with fleet buyers, and electric car sales have proven to be resilient, although at very low numbers. Sales of diesel-powered private passenger cars fell 28% in the March quarter, while hybrid sales fell 35%. Electric car sales jumped to 60 from 22, but petrol-powered car sales dipped 1% as total private passenger sales fell in the three months. It was a similar story for non-private passenger cars sales (fleets) with diesel sales down 30%. But among private SUVs, diesel sales rose 2.2%, but sales of petrol powered vehicles soared 20.4%. Non-private sales of SUVs recorded a small rise in diesel sales but a nearly 29% jump in petrol-powered SUV sales. Diesel-powered vehicles were still popular among private and fleet light commercial buyers. — Glenn Dyer
Mega oil strike. Not in the ground, but in the market with confirmation this morning that Shell is in advanced talks to buy BG Group for US$50 billion or more (over A$88 billion), a deal that could change the shape of the Australian LNG industry as well. BG Group controls the Curtis coal-seam gas LNG project in Queensland (Shell recently axed its coal-seam Arrow LNG project in Queensland, so BG is a replacement), while Shell still has a small stake in Woodside, which has the big North West Shelf LNG operation in WA. The Woodside stake could be sold to help pay for the BG buy. Shell also leads the US$12 billion Prelude floating LNG project off the coast of Western Australia, which will be the world’s first floating LNG operation. Shell last year sold off its Australian petrol stations and sole remaining oil refinery for $2.9 billion. The Shell deal is not finalised, but, in any case, it could kick off a string of a similar deals. Other major bids in the past five months have included the US$35 billion bid by Halliburton for rival oil services company Baker Hughes and the US$8.3 billion purchase of Talisman Energy by Spanish energy group Repsol. — Glenn Dyer
I guess it must be the country drawl, but I have always heard BMWs referred to as Beemers not Bimmers.