The sales of cars has increased in Australia over the past few years and this is despite a slump in the car market, according to the new chief executive of the Australian Automotive Association.
“The car market is in freefall,” Peter Bevan said.
It is the second year in a row that the car industry has been hit by a collapse in demand, following a record year in 2014.
Mr Bevan, who was appointed last month to the newly created chief executive position of the Association, said the trend of Australians not buying cars and buying used ones, is likely to continue.
In 2014, the car sector posted a record $3.4 billion in sales.
However, the market is expected to contract for the fourth consecutive year in 2019, according the Australian Car Association.
“It is a period of significant change,” Mr Bevan told ABC News Breakfast.
He said that over the last 10 years, the automotive industry had seen a decline in the market.
While there is now less demand than in the 1990s, the decline is not as dramatic as in the mid-2000s when demand had already begun to decline.
But Mr Beevans main concern is that the industry’s supply of vehicles is not increasing as quickly as it could.
That is the biggest issue facing the industry, Mr Bevenan said.
“There are a lot of people out there in Australia who are working on this, and they are trying to find the best way to deliver the best value for money.”
He described the current situation as a “bust-and-run” model.
With demand not increasing in the short term, Mr Heavis hopes to see the industry expand its supply of cars, but not as fast as it is currently expanding.
“The reason is because there are a number of different supply chains in Australia,” he said.