Read our Quarterly Report for Q1 2020Posted 23 June 2020
The impact of the Coronavirus has affected every part of the Australian economy including affecting asset values in the automotive, road transport, construction, manufacturing, mining, aviation and marine sectors.
Asset values do not have the volatility we might expect from the share market with large daily or even weekly fluctuations. Asset values may drop and rise at varying speeds however they tend to continue to track in that same direction for a period of time before reversing depending on supply in to the market of a particular asset class or until market factors impact on demand.
In the context of the coronavirus, the values across all asset classes have been negatively impacted however there has been a differing degree to this impact. In short, the automotive sector appears to have fared the worst with new car sales dropping 48.5%, with a total of 38,926 new vehicles sold across the country in comparison to the 75,550 sold in April 2019. This has not necessarily transferred through to the used car market. It would also be fair to surmise that values for used vehicles could recover more quickly than new cars as budget affected households opt for a financially sensible second hand car rather than buying new. Buyer activity over the most recent 4 weeks supports this theory.
The road transport and construction sectors have held up relatively well in comparison to the auto sector, where those assets are newer and with relatively low kilometres. The overall market appear to have only dropped 18.3% across the heavy, medium and light segments with demand remaining steady and buyers continuing to invest in second hand assets.
Join the Slattery team for a live webinar on Tuesday 26th May at 10:30am to learn:
- What is Market Uncertainty and how have asset classes reacted to Coronavirus
- State of the Market – Road Transport, Earthmoving & Mining and Automotive sectors.
Interested in attending? Don’t forget to click here to register your interest and submit any questions beforehand