The Economy: Travel, Car Sales Confirm Confident Tone

More evidence yesterday that Australian consumers are spending solidly.

Coming on top of a reasonable outcome for retail sales for August, the overseas travel data from the Australian Bureau of Statistics and the car industry's September sales figures tell us that consumption is running at pretty encouraging levels.

For example, overseas travel in August was up 10.7% on a year ago and car sales figures were up 2.1% on September of 2010.

Even though those car sales figures for September were 1.7% down on August at 86,819 units, back in July, sales that month were down 1.7% on the year and in June there were down a large 11.6% on June of last year.

So car sales have accelerated in the past three months and the reason is both continuing consumer demand and the recovery in supply of Japanese imports after the disruptions caused by the March 11 quake and tsunami.

For the year so far, sales of 752,128 are down 3.7% on the first 9 month of 2010: in August sales were 4.4% behind 2010 so by December they could have caught up, meaning another year of sales of around 1 million units.

If that can be achieved it would be further evidence that consumer demand in the country hasn't gone missing, as many economists and analysts assert. In fact it is being re-directed by astute consumers looking to exploit the higher value of the Aussie dollar.

The Australian Federal Chamber of Automotive Industries said September saw a 5.6% rise in sales of sport utility vehicles, after a 19% rise in August.

Sales of light and heavy trucks also boasted sizable gains, which points to healthy business investment.

Toyota's sales continued to recover after supplies of its cars took a particularly hard knock from the earthquake and tsunami.

The company held 20% of the Australian market in September, up from 18% in August and 16% in July.

Holden had 12.7%, while Ford regained third spot with 9.4%. Hyundai picked up to 8.6% in a strong showing, while Mazda had 7.0%.

Toyota's Corolla was the single best selling model in September with 3,766 units sold, followed by Holden's Commodore (3,712), Toyota HiLux (3,191) and Holden Cruze (3,117).

Top 10 sales by company:

Toyota - 17,378
Holden - 11,009
Ford - 8161
Hyundai - 7508
Mazda - 6037
Nissan - 5892
Mitsubishi - 4798
Volkswagen - 4407
Subaru - 2503
Kia - 2222

Top 10 sales by model:

Toyota Corolla - 3766
Holden Commodore - 3712
Toyota HiLux - 3191
Holden Cruze - 3117
Mazda3 - 2703
Hyundai i30 - 2493
Toyota Camry - 2049
Nissan Navara - 1885
Ford Falcon - 1708
Volkswagen Golf - 1664

Consumers are also spending heavily on overseas travel.

The ABS said yesterday that short-term resident departures were up 10.7% higher than in August 2010 at more than 661,500.

This was up 0.1% from August, but a much stronger 3.3% from July.

The ABS said that based on original estimates, the most popular destinations in Australia were Thailand (43.7%), Italy (18.9%), closely followed by Indonesia and the United States of America (both 18.8%).

And online travel agency group, Webjet has confirmed the travel boom with a sharp jump in ticket sales in the September quarter.

Webjet said yesterday that the value of its ticket sales in the three months to September was up by 25% at $188 million, against $149 million in the September quarter of 2010.

Not all of that is offshore travel; a lot would be domestic business for the school holidays at the end of the quarter.

"Most of this strong TTV growth has been produced by increasing transaction numbers as distinct from unit values, and has been achieved despite the non-operation of Tiger for part of this period," managing director John Guscic said.

"We believe the general travel market growth has been less than 10 per cent and, consequently, Webjet has substantially outperformed."

Webjet has forecast TTV and profit growth of more than 10% for the current financial year.

Mr Guscic said further full year guidance would be provided at Webjet's annual general meeting on October 19.