Retail sales may continue to fall into the June 2020 quarter, Statistics NZ said, after posting the largest drop in total volume sales in eight years on Monday.
Sharp declines were seen in vehicle sales, eating out and accommodation away from home in the March 2020 quarter in the lead-up to the COVID-19 lockdown, Statistics NZ data showed.
After adjusting for price and seasonal effects, the volume of total retail sales fell 0.7 per cent in the March 2020 quarter.
“This is the largest fall in total volume sales in eight years,” retail statistics manager Kathy Hicks said.
Hicks added that sales may continue to fall into the June 2020 quarter with a record fall in monthly electronic card sales already reported for April as many businesses went into hibernation because of the COVID-19 lockdown.
Data showed motor vehicle and parts retailing had the largest fall in sales volumes of all the 15 retail industries, down 7.5 per cent in the March 2020 quarter.
This was followed by the hospitality industries, with food and beverage services down 6.7 per cent and accommodation down 9.3 per cent.
The government’s efforts to slow the spread of COVID-19 led to the closure of all non-essential businesses from midnight of March 25.
“This hit car yards, takeaways, restaurants, hotels and motels hard, with sales dropping sharply,” Hicks said.
“Hospitality industries have also been hit by lack of international visitor arrivals due to travel restrictions since early February, which were meant to protect New Zealanders against COVID-19.”
The fall in hospitality and other industries was offset by a record increase in supermarket and grocery stores, up 8.5 per cent.
“Supermarkets stayed open during the COVID-19 Level 4 lockdown as an essential business, and widespread reports stated people stocked up on food and supplies as the quarter progressed,” Hicks said.
Including price changes, the seasonally adjusted value of total retail sales fell 0.4 per cent, $89 million, in the March 2020 quarter, after a 0.5 per cent, $120 million, rise in the December 2019 quarter.
The value of motor vehicle and parts sales was down 7.4 per cent ($248 million). This was followed by the two hospitality industries, food and beverage services, down 5.8 per cent ($179 million) and accommodation, down 11 per cent ($127 million).
Supermarkets and grocery stores had a record increase in sales, up 9.7 per cent ($514 million).
In actual terms, the value of total retail sales was $24.8 billion in the March 2020 quarter, up 3.4 per cent ($819 million) from the March 2019 quarter.
Data showed retail sales fell the most in the Auckland and Otago regions in the March 2020 quarter, which, according to Hicks coincided with border closures reducing overseas visitor arrivals and a fall in the number of foreign students arriving in New Zealand for tertiary studies.
