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The mining-rich states of Queensland and Western Australia are driving a boom in new vehicle sales - and that could trickle through to the used car buyer.
While the nation has recorded a 5.2 per cent increase in new car sales so far this year, Queensland is scorching ahead with a 13.5 per cent rise, ahead of Western Australia on 10.1 per cent. Adam Le Fevre, boss of Suzuki Auto Co which imports Suzukis to Queensland, says the boom in vehicles sales is mainly in rental vehicles which are up 91.6 per cent in Queensland and 65.3 per cent in WA.
"If you look at where the growth is, it's in the rental market and that's from the mineral and energy boom in those states," he says. "Companies would appear to be renting vehicles on demand rather than holding the asset.
"They are probably being sold at a corporate level in New South Wales of Victorian company headquarters and registered in Queensland and Western Australia where they are being used."
Le Fevre predicts that the boom in rental cars will lead to a flood of bargain-priced used cars in the next few years. "These cars have got to come back into the market at some stage as good-quality, low-kilometre, well-maintained cars."
While that may be good for buyers, Le Fevre said it would have a negative impact on new car sales. "Unless we can find a market offshore for these vehicles like New Zealand or Papua-New Guinea, then it is going to make it difficult for new car dealers," he said.
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