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Motorists on Economic ‘Roll-a-Coaster’

Motorists can be forgiven for feeling they are riding an Economic ‘Roll-a-Coaster’, as they lose on the one hand what they have gained on the other.

New cars have never been more affordable, in terms of average weeks wages required to purchase a medium sized family car.

This has been brought about by steadily falling import duty, from an historic high of 57.5% some two decades ago, down to 10% in recent times, coupled with a rising A$ exchange rate, making imported cars more affordable, in addition to which a 22.5% ‘Wholesale Tax’ was replaced by a 10% ‘Retail Tax’ with the introduction of GST, some 6 years ago, reducing all new vehicle prices across the board.

Consumers have been quick to seize upon this opportunity, purchasing New vehicles faster than ever before, with New Vehicle sales in Australia rising year-on-year and National New Vehicle sales for the 2007 year poised to exceed 1,000,000 units, for the first time in Australia’s motoring history.

So much for the ‘good news’, for whilst this has been happening on the one hand, operating costs have been steadily rising on the other, leaving motorists with mixed feelings about the future affordability of personsal transportation.

Fuel has risen in price to all time highs over recent months, at times climbing to just below $1.40 per litre. This has driven a huge swing away from the ‘Traditional BIG Aussie Car’, as motorists downsize in their tens of thousands, all keen to squeeze more kilometres out of each tankful, with Toyota’s Corolla ’small’ car, very close to over-taking Holden’s Commodore ‘large’ car as Australian sales leader

The first ‘victim’ of this swing has been Ford’s flagship model, the once much loved, admired and envied ‘Fairlane’, with sales falling over recent years, Ford has been forced to re-assess the models viability and decided it just had to go.

Service and Repair costs are another area where motorists are facing rising costs, more cars on our roads means more cars to service, but with the current skills shortage, thanks to the economic good fortune of Western Australia’s Resources boom drawing people from the Automotive Industry into the Resource Sector, the Auto Service Industry is forced to pay well above award rates, to retain and/or attract qualified Automotive trades people resulting in rising labour charges for service and repairs.

Whilst both State and Federal initiatives have been introduced in an endeavour to train more Automotive trades people, the benefit of those extra workers won’t be realised immediately.

A third area impacting on motorists ‘hip-pocket’ has been the rapidly falling re-sale values of the larger cars, as demand for second-hand smaller cars continues to rise.

Motorists can look forward to stable New vehicle prices, but rising fuel and service costs… But that does not mean all doom and gloom, it just means purchasers need to ‘look-before-they-leap’ and where appropriate take some pre-purchase advise from someone with a broad knowledge of the Automotive Industry and the changes that are currently occurring. this will enable motorists to make an ‘informed’ purchasing decision that could well save them thousands, or even tens of thousands, of dollars, over the period of ownership of their next vehicle.

Posted in Motoring by admin |

Lifestyle Updates

Motorists on Economic ‘Roll-a-Coaster’

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