Low sales, free trade push new car prices down

Car makers in Australia are aggressively cutting prices in
Australia as sales plummet and tariff cuts come into effect, according to a report

According to The Financial Times, Toyota cars from Japan have
had their prices reduced by as much as 5 per cent, with other Japanese brands
also marking down new vehicles due to the Japan-Australia Economic Partnership Agreement, which began to come into effect yesterday.

“The Australian market has become incredibly competitive,”
Tony Cramb, Toyota Australia’s director of sales told the Financial Times.

“This aggressive move on price is part of Toyota’s renewed
commitment to the people who buy our vehicles.”

As the Japan Times reported earlier this week, from yesterday
Australia would remove tariffs on Japanese cars with engine displacements of
1,500 cc to 3,000 cc. Over the next three years, tariffs on larger vehicles
will also be removed.

Sales of Australian-made new cars have fallen sharply in
recent years in the ultra-competitive, heavily-fragmented local market, which
featured 67 brands and 350 models available last year.

As reported by Manufacturers’ Monthly and others earlier this month, the Federal Chamber of Automotive Industries tallied only 100,468
locally-made vehicles sold in 2014, the lowest figure since 1953.

Australia will lose its passenger car manufacturing sector in
2017, with Toyota and Holden to close their factories that year, and Ford the
year before.