Changing consumer preferences
There has been a significant change in the type of vehicles demanded by Australian consumers.
[1] Traditionally, the Australian vehicle market has been dominated by large passenger cars and their variants. There has been a trend in Australia and internationally towards smaller, lower fuel consumption vehicles, sports utility vehicles (SUVs) and luxury cars. This trend has recently accelerated, and impacted on local vehicle producers, with the market share of Australian MVPs falling from 30 percent in 2002 to 19 percent in 2007.
More specifically, since 2002, domestic sales of new Australian-made vehicles have decreased for GM Holden (by 33 percent), Ford (by 10.5 percent), and Mitsubishi (by 53 percent). Only sales of Australian-made Toyota vehicles have increased since 2002—by 22 percent to 2007. This trend has continued into the first two months of 2008, with sales of Australian-made vehicles continuing to fall.
Nonetheless, there are early encouraging signs that Australian MVPs are responding to the changing market circumstances. For example, Ford has announced plans to manufacture the four-cylinder Focus in Australia from 2011, and Toyota plans to build the Camry hybrid locally from 2010.