National Reserve Bank of Tonga

Lower vehicle registration continued to February

Vehicle Registrations February 2018

Total vehicle registrations declined over the month of February 2018 by 204 registrations (62.8%), recording a total of 121 registrations. This is lower than the monthly average of the past five years. Registrations for all vehicle types declined due to the disruptions caused by Tropical Cyclone (TC) Gita during the month as people were more attentive on repairing of their homes which were damaged or destroyed by TC Gita. According to liaison with vehicle importers in Tonga particularly Taxis & Rentals and Car Dealers, vehicle imports usually decline at the beginning of every calendar year, following the increase in imported vehicles at the end of the year for the holiday and the Christmas season, and the excess stock in the market.

However, import payments for vehicles were sligthly stable over the month at $1.4 million which may reflect the advance payments for vehicle imports in previous months. Demand for vehicle loans from banks also declined over the month by 1.2%
supporting the trend.

In year ended terms, the total number of vehicles registered rose by 96 (2.7%) reflecting the continued strong demand for vehicles. Majority of the annual rise were for light vehicles which rose by 75 (5.7%) followed by a 38 (90.5 %) increase in the registration of government vehicles. Other vehicle registrations also increased except for cars and buses. The rise in purchasing power of returning seasonal workers from abroad may have also contributed to the annual rise. The increase in the level of vehicle registrations may also be attributed to the availability of hire purchase options and the convenience of purchasing vehicles online. However, the import payments for vehicles recorded in the Overseas Exchange Transactions reports slightly declined by $0.2 million (0.8%) over the year to February 2018 compared to the previous year.

On the outlook, the receipts of remittances and demand for finances for the post‐cyclone recovery may dampen the demand for vehicles. Furthermore, despite the progressive increase in petrol prices, the total registrations of vehicles are projected to increase in the short term supported by the advance payment for vehicles and the higher purchasing power of returning seasonal workers from Australia and New Zealand.

Resources

Vehicle Registrations - December 2017 Released on 28 May 2018 |  144 KB - Download a copy of the full report.

See more Vehicle Registrations releases.