Australian treasurer Peter Costello on Wednesday said the strong Australian dollar is making it tough for exporters but the outlook for the automotive industry remains robust, according to a Dow Jones report.
Go deeper with GlobalData
Costello reportedly said the improving world economy, innovation by vehicle manufacturers, and the government’s ongoing solid economic management are positive factors for the automotive sector.
“Although the recent appreciation of the exchange rate is putting pressure on exports, with an improving world economy, continued innovation by the automotive industry, and ongoing sound economic management and reform by the government, the future of the industry is still strong,” the treasurer said in a statement cited by Dow Jones.
The news agency noted he made his comments after the release of data showing sales of new motor vehicles in Australia reached a record 909,811 in 2003, exceeding the 900,000 level for the first time in a calendar year.
In December, new motor vehicle sales declined 4.8% to a seasonally adjusted 72,773 from 76,412 in November, the Australian Bureau of Statistics reportedly said.
How well do you really know your competitors?
Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.
Thank you!
Your download email will arrive shortly
Not ready to buy yet? Download a free sample
We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form
By GlobalDataAccording to Dow Jones, Costello said the overall result for 2003 is partly due to the impact of lower taxes through the abolition of the 22% wholesale sales tax.
This means that cars are now subject only to a 10% goods and services tax for consumers, and there is effectively no tax at all for business and fleet consumers, Costello reportedly said.
Reductions in import tariffs – to 15% currently from 25% in 1996 – have also cut car prices, he said, according to Dow Jones.
Costello reportedly noted the Federal Chamber of Automotive Industries is predicting that sales of new motor vehicles will again top 900,000 in 2004.
As well, automotive exports are approaching A$5 billion a year, almost triple their level in 1995, meaning the industry is now Australia’s sixth-largest exporter, the report added.
Dow Jones noted that Australia’s $A17 billion car industry is dominated by four local units of overseas manufacturers – Mitsubishi Motors, Ford, General Motors and Toyota.
