2013 - And the year ahead • Autotalk (2024)

It has been a busy year for the automotive industry. Numbers across the board are up, the economy is roaring, and we have had a relatively stable regulatory environment.

But can it continue. We spoke to a number of key industry players, and dealers in the field, to see how their year was – and what they are expecting for 2013.

Manheim New Zealand managing director: Craig Ross

“We had a very good year in 2013 implementing a new end-to-end national business model for the salvage industry, which has been up and running most successfully,” says Ross.

“I’m not going to tinker with such a successful formula, but will take my hands off and let it carry on,” he says.
“I think that 2014 will be a bumper year, used imports are up, business confidence is up, and people will do stuff which benefits the auction industry.

“Machinery and equipment sales have also been very good this year, the replacement of large capital equipment means there is a second and third tier market waiting to purchase the secondhand stuff and some of it may even be bought and shipped to the Pacific Islands.”

Ross says that sensible decisions by parties through the value chain can net tangible savings and reduce the cost of doing business, producing a better return for all parties in the transaction.

He cautions, however, that the actual auction method itself may be in for a change in the way vehicles are driven through a lane to be displayed to the bidders.

“I think the auction game is due for an overhaul.”

Autohub managing director: John Davies

“It was a solid and consistent year for us in 2013, and I would expect another relatively similiar performance again in 2014, thanks to the strong New Zealand dollar,” says Davies.

“Buying in Japan has backed off a little at the moment as dealers currently have plenty of stock, but this will pick up again,” he notes.

Changes to tax laws in Japan could see some disruption to stock flow for imports in the coming year.
“The only possible spanner in the works is that the Japanese local sales tax is due to rise from 5 to 8% sometime in the middle of 2014, and then it will rise to 10% by October 2015,” says Davies.

“This could have the potential to create fluctuations in the auction market as people rush to trade their older cars in before the higher priced used import stock arrives, therefore creating lower auction prices for the trades and when those have cleared, prices could then rebound later as there may be less trade in stock to auction.”

Holden New Zealand managing director: Jeff Murray

General Motors had the delicate task this year of announcing its plans to pull out of manufacturing vehicles in Australia.

While the Holden Cruze and VF Commodore were the sales heroes for Holden in 2013, Murray hopes that the recently introduced Model Year 14 Colorado will peg back the gap between it and the top selling Toyota Hilux and Ford Ranger.

Murray says the fight between Hilux and Ranger got ‘a bit aggressive’ towards the end of 2013 – and he feels that the 30% growth in commercial sales won’t be replicated in 2014, it will be more likely 3 to 5%.

“There were many businesses playing catch up with their ute purchases in 2013, I don’t feel that will be the case this year,” he says.

In a market that grew by 12%, Holden increased its share by 1% in 2013 with an increase in volume of 22%. Murray says it was the fastest growing brand in 2013 and he would like to repeat the same in 2014.

“We’ll have a full sales year with 4 to 5 new car lines and a strong retail presence which should impact positively on our results,” he says.

Suzuki New Zealand chief executive: Tom Peck

“It was definitely a tougher year than 2012 for Suzuki with a few more aggressive competitors, with price drops on cars such as the Fiat 500, Holden Barina, and Toyota playing hard with the Yaris,” says Peck.

It was not a bad year though:

“We were not unhappy with our sales results, especially as the Swift remained the number two passenger car overall behind the Corolla,” Peck says.

“With the exception of Swift and Kizashi, all of our product exceeded their 2012 sales numbers but then 2012 was a record year for Swift.”

Like a number of distributors in the current market Peck laments the lack of a ute in his vehicle range. But Suzuki continues to grow its network with dealerships added in Matamata, Morrinsville and Whakatane.

“Unlike the other market competitors we don’t have a ute, so while we think the market will grow again in 2014.

Our aim for Suzuki will be to maintain our market share, we’d like to exceed 5500 units this year,” Peck says.

Toyota New Zealand general manager sales: Steve Pragnell

“Its been a stand-out year with new car sales up 8.9% on 2012,” says Pragnell.

Toyota New Zealand sold 24,262 Toyota and Lexus vehicles in 2013 – and was by far the most popular car brand in New Zealand with five vehicles in the top 10 sellers.

Pragnell says 26 years, at number one is a fantastic endorsem*nt of Toyota by New Zealand. The Corolla has been the country’s favourite passenger car in its segment for 16 out of the last 26 years he says.

It was also a great year for the Hilux, now with 32 years of consecutive market leadership with 454 sold in December and 5039 units sold in total in 2013.

“This year we are introducing the all new Corolla Sedan, redesigned in Europe, and offering improved comfort and drive experience,” says Pragnell

John Andrew Ford and Mazda dealer principal: Paul Brown

“In 2013 we saw around 20% increase in new Mazda sales and nearly 10% in Ford, and certainly commercial vehicle sales were strong,” says Brown.

“We had an excellent December, thanks to an early retail sales event which set us up well for the month, and a number of corporate customers took delivery of their vehicles before Christmas.

“We also saw strong volume of finance agreements signed off every month, and our parts and service department also performed strongly too. I hope this trend continues through 2014.

“My prediction for the coming year is that corporate and fleet sales will be stronger and we will see steady but not spectacular growth in retail sales.” he says.

Brian Scott Motors Dunedin managing director: Brian Scott

“We enjoyed a 15% increase in sales in both the yard and the workshop in 2013 over the previous year – it was a much better year than 2012,” says Scott.

“We also celebrated our 20-year anniversary in September 2013. This business is quite unique in that it was set up by my late mother and myself, so a mother-and-son rather than a father-and-son business as many automotive businesses are.

“December traditionally is always a quiet time for us, 2013 was slightly better than 2012 – although we closed the yard and the workshop for two weeks, two of my staff got bored at home and came in to sell four cars.

“My prediction for 2014 is that it will be a busy year, we’ve got a good government, good leadership and everything feels like its getting better. To me its a good outlook.”

AC Auto Imports Hamilton dealer principal: Alan Cushion

Cushion says that 2013 was pretty average and he is looking forward to a much better year in 2014.

“We found it quite hard going to be fair, and I’ve spoken to other Hamilton dealers who have made the same comment.

“I thought that 2013 would be a much better year for us than 2012, but it was only marginally. We put a lot of work into deals that didn’t come off and it was frustrating.

We had a few good months and we did a few good deals with good margins, but money was tight and many people had unrealistic expectations for their trade-in or had unrealistic expectations about financing.”

However, Cushion says on the positive side of the ledger he did tap into a new group of customers who were happy with the product and service he offered.