Kiwi car spending declines due to Covid-19 lockdowns

In news that won’t surprise many, numbers from Stats NZ showed that local spending on cars and car parts “fell significantly” during the third quarter of 2021; a quarter riddled with Covid-19 lockdowns. 

The data group notes that spending in the automotive sector dropped by 12 per cent in the September quarter relative to the same period last year. 

The drop sees automotive suffering the fourth largest drop of any industry in percentage terms, behind department stores (24 per cent), food and beverage services (19 per cent), and building supplies (15 per cent). 

Unsurprisingly, it’s Auckland that’s fared the worst. Overall, consumer spending dropped by 15 per cent ($1.5billion) during the quarter, a number that Stats NZ says is a new record drop. Auckland of course suffered through an extended Level 4 lockdown during this time. 

For those in the motoring space, seasonally adjusted retail sales value across vehicles and parts fell by 12 per cent to $3.6billion, a drop on the $4.1billion spent in the June quarter and down on the $3.8billion spent last Q3. 

There was a similar decline in Stats NZ’s seasonally adjusted volume of total retails sales in the automotive sector, with an 11.6 per cent drop from $4billion to $3.5billion recorded.

Stats NZ’s retail trade manager Sue Chapman says the country’s lockdowns “resulted in lower sales across most retail industries”, adding that feedback from the motoring industry also included concerns about supply.

“Several comments from vehicle dealers and building supply owners stated that extended lockdowns, increased inventory costs, and increased supply issues led to lower sales and higher stocks this quarter,” Chapman said.

In terms of new vehicle sales, the Motor Industry Association’s data showed surprisingly steady sales during lockdowns, although certain manufacturers experienced significant fluctuations in sales totals due to inconsistent supply. 

August was a predictably torrid month for new vehicles, with a huge 36.2 per cent drop in new-car sales during national Level 4 lockdown. September, however, represented the strongest month of new vehicle sales in New Zealand history … influenced in part by orders that had carried over from previous months. 

As of the end of October, 242,875 cars new and used have been registered in New Zealand this year. This almost equals the amount of cars registered locally last year, with two months still to go.