New motor vehicle sales in Australia had been increasing steadily from 1991 to 1998, from 514,566 to 807,669 units respectively, when it dropped in 1999 to 786,845 units (Department of Industry, Tourism and Resources, 2002). The drop in sales figure from 1998 to 1999 could be attributed to the global economic crisis in which World Bank (1998) had predicted that "developing countries will be hardest hit by the economic and social costs of global slowdown in 1998-2000". In year 2000 however, sales figure rose slightly again to 787,100 (Department of Industry, Tourism and Resources, 2002).
             Of the new motor vehicles sales in year 2000, 70.3% ownership of vehicles were passenger motor vehicles, whilst 27.1% were sales of light trucks and 2.5% of heavy trucks sales. It is evident that the passenger motor vehicle is the most popular mode of private transportation in Australia (Appendix 1).
             According to Deloitte Touche Tohmatsu – Australia (2002), the "Australian automotive industry is currently operating in a changeable and unprecedented climate". The industry is depicted as one with high fixed costs and slim margins. In addition, there is "global over-capacity of participants" and a "small volume base" in Australia (Deloitte Touche Tohmatsu –Australia, 2002).
             Some of the factors affecting the industry include the implementation of the Goods and Services Tax (GST), the new Automotive Competitiveness and Investment Scheme (ACIS), the international escalation of interest rates, the "global reach of markets" and growth of eCommerce, which has seen a hike in the number of consumers accessing information and purchasing online (Deloitte Touche Tohmatsu – Australia, 2002).
             2. Analysis of the Australian Automotive Industry
             As mentioned earlier, the introduction of the GST is one of the factors affecting the industry. Introduced in July 2000, the GST was a shift from the W...