The Driven/9ridie Schmidt: Survey confirms car purchases on hold as consumer interest turns electric

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Survey confirms car purchases on hold as consumer interest turns electric

Posted on March 20, 20193 minute read
Bridie Schmidt

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A new report from market research firm Roy Morgan has indicated that less Australians intend buying new vehicles in the 12 months, with interest in petrol cars declining, and interest growing in hybrid and electric cars.

While there’s also a mild increase in interest in buying diesel vehicles (perhaps tied to increasing sales in the SUV market segment), the figures appear to support the theory that the impending arrival of more electric and hybrid models are putting sales of ICE (internal combustion engine) cars on hold.

This follows a sharp plunge in vehicle sales in the first few months of 2019, including a 21 per cent slump in passenger vehicles. The data from Roy Morgan’s survey suggests this slump could continue over the next 12 months.

Roy Morgan says 553,000 Australians intend to buy a new car within 12 months at the end of 2018 (which is 9.9% less than a year before), although around 4 times as many – 2.125 million intend to buy a new car within the next four years, which is a rise of 6 per cent.
Source: Roy Morgan
Source: Roy Morgan

Norman Morris, industry comms director for Roy Morgan says that the changing market is due to a variety of factors, including the wider range of alternative fuel options.

“Over recent years there has been considerable growth in the new vehicle market but this is now facing a number of real challenges,” Morris says.

“There is currently some concern about the slowing economy, lack of wage growth, energy price escalation, declining home values and political uncertainty with a potential change of government.

“In addition to these potential economic constraints on new vehicle demand, the rapidly changing technologies with the resultant fuel choice decisions adds to the complexity of decision making in this market.”

That increase in fuel choices is now being reflected in purchase intention, Roy Morgan’s report shows.

When compared against V-Facts 2018 sales figures (which must be noted do not include Tesla sales figures), the dip in interest in petrol (which is down 13.1% from 75%) is in stark contrast to electric, hybrid (and as noted, diesel).

Roy Morgan’s data shows diesel saw a rise in interest by 3.6% – but even against diesel, the case for electrified transport is generating far more interest – 9.1% for electric (2% increase) and hybrid (7.1% increase) combined.
Source: Roy Morgan
Source: Roy Morgan

The shift in interest from petrol-powered vehicles to electric is seen in varying degrees across different generations, with baby boomers leading the way for fully electric vehicles (3.3% compared to between 1% and 2.2% for other generations).

Oddly, Generation X – those born between 1961 and 1975 – lags behind the other sections of the population when it comes to interest in hybrids (3.1% compared to between 9.4% to 12.6%).
Source: Roy Morgan
Source: Roy Morgan

The relative delay in getting electric vehicles available on the Australian market (and therefore lack of choice – and volume, as has been noted with the Hyundai Kona EV which is due to be launched within weeks) has been noted as one reason behind the desire to wait to purchase.

This delay of the arrival of EVs in any great numbers also gives legacy manufacturers time to offload ICE vehicles before electric vehicles become part and parcel of the Australian landscape.

Things are changing, but how quickly, says Morris, is up to the consumer.

“We have already seen some early signs of changes in this industry, particularly in the very major move away from cars to SUVs and the speed and range of new models entering the market.

“Most manufacturers are ramping up their development in areas such as electric vehicles and driverless cars but it will ultimately be the consumer that will determine who the winners are,” says Morris.
Bridie Schmidt
Bridie Schmidt

Bridie Schmidt is staff writer for The Driven, and Renew Economy. She specialises in writing about new technology, as well as using her technical skills in managing our websites.
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