Car Users Forced To Downsize

Illawarra Mercury

Saturday April 8, 2006

BENJAMIN LONG

THE EFFECT of rising fuel prices continues with more than 10 per cent of Australian motorists having traded in their four-wheel-drive or large eight and six-cylinder vehicles in an effort to reduce growing fuel costs, according to figures released Friday by insurance provider Budget Direct.

The independent online survey of more than 22,000 respondents asked whether they had considered or if they had changed their vehicle for a more fuel-efficient model, to which nearly 50 per cent said they had considered the option.

Budget Direct CEO Michael Weston said he was not surprised by the figures, given the continued surge in fuel prices over the past two years.

"There are certain segments of the Australian population, namely high-income earners, who will be largely unaffected by fuel price increases, but for the average Australian, it's forced a serious rethink of their car maintenance preferences," Mr Weston said.

"Manufacturers of four-wheel-drives as well as eight and six-cylinder vehicles are certainly starting to see the ever-increasing negative effects of rising fuel prices, with 2.6 per cent of survey respondents telling us they had already traded their four-wheel-drives for more fuel-efficient cars, and 7.5 per cent of eight and six-cylinder drivers doing the same."

Official figures released in early March by The Federal Chamber of Automotive

Industries (FCAI) showed a 9 per cent decline in sales of Sport Utility Vehicles (SUV) throughout February, compared to the corresponding February 2005 period.

Mr Weston said this trend had seen car owners offsetting rising fuel costs by purchasing a small car to ensure they can maintain their car usage.

"We also asked respondents whether or not the rising fuel prices affected their car usage, to which 48 per cent said no. However, just over 40 per cent said they had been using their car less often - these respondents could be part of the 47.5 per cent of car owners who are on the verge of downsizing," he said.

Budget Direct is part of the international Budget Holdings Limited insurance group.

The Budget Direct figures were supported by data from Toyota Australia which said a continued shift by buyers towards smaller motor vehicles has resulted in record sales for a couple of new Toyota models.

Two of Toyota's best performers were the new-generation RAV4 compact Sports Utility Vehicle (SUV) and the new Yaris light car.

Toyota Australia executive director of sales and marketing, David Buttner, said the RAV4 was attracting buyers from a wide demographic including those trading down from large family sedans and larger SUVs. The RAV4 attracted 1507 customers in March.

Yaris sold 2079 last month to top the light car class, a 35.6 per cent increase on the sales of its Echo predecessor in March 2005 and Toyota's second best ever month of light car sales.

"Yaris volumes were boosted by the arrival of the sedan version in the showrooms last month and we expect the sales benefit of the wider model range to be more pronounced in coming months," said Buttner.

© 2006 Illawarra Mercury

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