But demand is at a plateau.

Also, over the last few years there have been a number of new brands enter the market and a lot of new models.

We have grown from around 65 brands to nearly 80 brands now. Most of the growth is from Chinese brands, focusing on electric and hybrid vehicles.

The problem is that while there are multiple new models available for electric vehicles, that segment of the market is shrinking and now less than 7% of total sales.

Also, there are a number of new brands that have introduced Utes into the market. Many of the new Utes are PHEVs or MHEVs.

Here is the economics lesson. For electric cars, increasing supply combined with decreased demand means that consumers win. Pricing must fall for brands to compete.

That plays into the new entrants’ hands as some of the established brands all have excellent EV models but no demand.

The second part of the economics lesson is that while the Ute segment is growing, the supply is also outstripping demand. That also means better pricing for consumers.

The manufacturers are tightening their belts, and some will simply not last. That brings a whole new set of issues for buyers.

Its interesting times ahead

This is a Motoring Minute

Im Rob Fraser

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