Industry Analysis & Industry Trends
The Car Retailing industry experienced a tumultuous past five years. Demand for motor vehicles slid into a ditch as consumer confidence wavered in the aftermath of the global economic downturn. Australians put off spending on big-ticket purchases such as cars. Motor vehicle sales have since recovered on the back of pent-up demand and strong consumer confidence. High fuel costs also hurt motor vehicle sales. Industry revenue is expected to increase at a slow 0.7% annualised over the five years through 2012-13 to reach $72 billion. Revenue is expected to grow 4.6% in 2012-13. Revenue will grow at a solid pace due to stronger consumer sentiment and higher real household disposable income.
Despite the weak revenue, industry profitability improved over the past five years... purchase to read more
Industry Report - Industry Investment Chapter
Capital intensity is low within the industry. The ratio of labour to capital is used to determine the amount of labour used for every unit of capital in the industry. It is an indicator of the capital-labour mix typically used in the industry. Wage costs are used as a proxy for labour while depreciation is used as a proxy for capital. The industry is capital intensive and this is reflected in the $17.75 spent on labour for every dollar invested in new capital.
Retail industries are typically labour intensive. Businesses in the industry require staff to generate sales and carry out administrative work. There has been a decline in the availability of skilled salespeople, which has put upward pressure on labour costs... purchase to read more