Luxury cars on the up in rural Aus

This figure might not be as impressive as the 198,350 cars sold under the threshold in 2014 but "luxury" car sales have increased in rural Australia, according to Federal Chamber of Automotive Industries (FCAI) statistics.

Despite a 7.6 per cent decrease in sales across the rural market from 2013 to 2014, the market bounced back from March last year to March 2015 to record a 0.3pc increase.

Luxury cars aren't defined by the Australian Taxation Office (ATO) by their premium branding but rather by their GST-inclusive sale price.

Cars sold for more than $61,884, or $75,375 for fuel efficient vehicles, have the ATO's luxury car tax (LCT) applied on any amount more than the threshold.

According to FCAI statistics, car sales in rural Australia priced in the luxury car tax threshold have increased in small passenger, large sports utility vehicle (SUV) and upper large SUV categories.

Nissan "workhorse" vehicles are arguably one of the best selling makes in regional Australia, but the motor company is seeing a spike in sales of its sports and luxury models.

"Fourteen per cent of Nissan GT-R supercars purchased last year were to customers in regional Australia and about 16pc of all Nissan 370Z sales were to rural buyers," said Nissan Motor Company corporate communications general manager Peter Fadeyev, Dandenong South, Victoria.

"The figures are slightly higher for Nissan's luxury SUV models. Forty per cent of Nissan Patrol Y62 sales have been in regional Australia and rural buyers comprise almost 20pc of all Nissan Pathfinder Ti sales," he said.

From 2010 to 2013, small passenger vehicle sales to rural customers priced under the LCT increased from 58,707 to 66,914 but took a hit in 2014, with just under 62,000 sales recorded.

Meanwhile, cars in the same category priced over the LCT tripled from 84 in 2010 to 261 last year.

The FCAI defines small passenger vehicles as a four to six cylinder sedan, hatch or wagon with two, four or five seats such as the Holden Cruze, Mazda 2 and Toyota Yaris.

"Luxury cars in rural areas are actually increasing for Audi," said Audi corporate communications general manager Anna Burgdorf.

"Sales are growing almost as strongly in rural and regional areas as they are nationally in spite of the rural market decline overall.

"Audi has grown 19.8pc in rural while nationally, Audi grew 15.3pc."

Ms Burgdorf, Sydney, said this trend had also been recorded for the first quarter of 2015.

"Fewer dealers in rural areas can equal lower sales but it's often the servicing that has the biggest impact (on customer choice)," she said.

"To combat this issue, we have what we call 'flying technicians' from Perth to service vehicles for our clients."

New Audi dealerships have opened in regional areas in the past few years, including Tamworth, Shepparton and Wagga Wagga, adding to its list of 14 regional dealerships across Australia.

"It's fair to say that luxury brands might not offer 'workhorse' type vehicles but we certainly offer fairly rugged vehicles like SUVs that make excellent all-terrain vehicles which are often driven for non-work purposes."

Large SUVs, including variants of the Toyota Prado, Jeep Grand Cherokee, Ford Territory and Holden Captiva, have proven the most popular in the luxury category for rural Australians.

Sales in this category have increased in popularity across the board, recording 37,661 total sales last year.

Large SUVs are defined by the FCAI as six to eight-cylinder, two, four or all-wheel drive wagons.

Car sales in this category selling for less than the LCT threshold have increased from 21,326 in 2010, spiking in 2012 at 26,111 before settling at 24,872 last year.

Cars over the threshold in this category recorded 10,266 in 2010 before increasing to 12,789 last year.

Jaguar Land Rover Australia senior public affairs executive James Scrimshaw, North Ryde, said the rural market made up 18pc of the total Land Rover volume.

"Most of the vehicles in the Land Rover range are above the LCT but the split between metropolitan and rural sales has stayed the same for the past 12 months."

Last year, just under 5500 upper large SUVs were sold with only 599 of these priced under the LCT.

Vehicles in this category are defined as four to 12-cylinder, two, four or all-wheel drive wagons and include the Toyota LandCruiser Wagon, Mercedes-Benz G-Class, Nissan Patrol Wagon and Land Rover Discovery.

Across a five-year period from 2010 to 2014, upper large SUV sales under the LCT have dropped from 1596 to 599 while those over the threshold have jumped from 3892 to 4847.

Toyota is also a brand synonymous with rural Australia but the company has long been opposed to the LCT, which currently applies to Toyota Kluger Grande, Prado VX, Prado Kakadu, Prado Altitude Special Edition and all variants of the LC200 model.

The Toyota Motor Corporation even decreased recommended retail prices on some of its LandCruiser, Prado, Kluger and Tarago models last year following an increase to the LCT last year by the ATO, according to Toyota executive director of sales and marketing Tony Cramb.

"The tax does not recognise that many vehicles in the luxury category offer important safety, environmental and theft-reduction benefits."