The TrusTed voice of The auTo indusTry for more Than 30 years
www.autofile.co.nz
January 2018
Population boom to boost vehicle sales Economist predicts net migration, high ownership rates and improving economy will push up demand over next half-decade
O
ne of New Zealand’s leading independent economics consultancies has increased its five-year forecast for car sales. Infometrics says a big part of the long-term lift – compared to its outlook early last year – is a change in predicted levels of net migration. The company adds other factors, such as high ownership rates and an improving economy, will also push up demand for vehicles over the next half-decade. Mieke Welvaert, an economist at Infometrics, says net migration heavily influences underlying, or “fundamental”, demand for cars. “The number of people in the country has a big effect on the number of things purchased, including cars,” she says. “Strong net migration and record high levels of arrivals show there are more people coming into the country who are probably going to buy a car. Even if they are here on work visas, they are
Source: Infometrics
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likely to get vehicles for their trips around the orchards over summer. “As a result, migration and its effect of increasing the number of households is one of the factors we include in our fundamental demand estimates.” In September, Infometrics estimated that population growth would account for 45,000 to 65,000 car sales during each of the next five years. It revised its outlook for net
migration compared with February 2017 because – outside of a policy change – there was little reason to suggest arrival numbers would decrease over the coming year. However, since its July forecast, Infometrics has had another round of forecasts and now thinks that migration has reached its peak. “Without knowing which team Winston Peters would choose, we forecasted that arrival numbers would hover at their current high of 132,000
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