Commercial registrations and activity

Very heavy commercial registrations truck along

14 Aug 2023

Brad Olsen

Our take on the latest Commercial registrations and activity (Mon 14 Aug 2023)

New very heavy commercial registrations up 21%pa

Light commercial registrations halve in July 2023 compared to a year ago

Road user charge kilometres purchased down 33%pa

The key numbers...

There were just 1,646 new commercial vehicle registrations in July, down 43% from July 2022, and down a massive 64% on the bumper, policy change-inspired, June 2023 month (seasonally adjusted).
The Clean Car Discount changes in 2023 mean that June’s figures were considerably higher than usual due to pre-purchasing, and as a result, the July figures are weaker. Compared to the Jan-May 2023 average (seasonally adjusted), new commercial registrations were down 53% from usual underlying registration levels in July.
Light commercial vehicle registrations suffered the most, with new light registrations down 51%pa, compared to the 29%pa fall for medium commercial vehicle registrations.
However, new very heavy registrations rose a considerable 32%pa in July, taking year-end growth to 22%pa. Removing seasonal effects, July 2023 was the strongest month ever for new very heavy vehicle registrations.
Road user charge (RUC) kilometres purchased in July fell 33%pa, with year-end growth settling back to 2.4%pa. Light RUC distances purchased are up 2.5%pa on average over the last year, compared to a 5.6%pa increase in medium purchases and a 1.8%pa fall in very heavy RUC kilometres purchased.

Very heavy trending higher, but lights struggling

New commerical vehicle registrations, by type, 3-month moving averages, indexed to Jan-19 = 1,000

...and our reaction

The changes in July to the Clean Car Discount have again thrown light commercial vehicle registrations around, with some pre-purchasing in June before the change, followed by a steep fall in registration in July.
Light commercial vehicles didn’t see as a sharp of a pre-purchasing jump this time around compared to the original implementation of the Discount, but have seen a large drop-off. Light commercial vehicles are most exposed to the Discount changes, which increased the fees charged on higher emitting vehicles like utes, which are generally classed as light commercials.
The underlying trend for light commercials remains weaker, given higher interest rates, and declining expectations in the construction industry, all of which have dampened demand. The lower amount of pre-purchasing shows that the light commercials market, although still price sensitive, is more restrained overall due to less demand generally for more light commercial vehicles.
The continued growth in heavy commercial vehicles appears at odds with the generally softer economic outlook, lower freight volumes, and rising interest rates. However, delays remain considerable for very heavy commercial vehicles, from what we understand, meaning the current strength of registrations may pre-date the current economic outlook by nearly a year.
RUC purchases appear to be broadly in line with expectations, being up 2.4%pa over the 12 months to July 2023 and indicating that there was limited overall over-purchasing of cheaper RUC distances when transport subsidies where in place. Yet with freight volumes lower, and less construction work expected over the next few years, we expect RUC purchasing to weaken.

Latest updates

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Commercial registrations and activity

Very heavy commercial registrations truck along

The key numbers...

Very heavy trending higher, but lights struggling

...and our reaction

Latest updates

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