Spending on vehicles, on eating out, and on accommodation away from home fell sharply in the March 2020 quarter in the lead up to the COVID-19 lockdown, according to Stats NZ.
After adjusting for price and seasonal effects, the volume of total retail sales fell 0.7 percent in the March 2020 quarter, after a relatively flat December 2019 quarter.
“This is the largest fall in total volume sales in eight years,” retail statistics manager Kathy Hicks said.
Motor vehicle and parts retailing had the largest fall in sales volumes of all the 15 retail industries, down 7.5 percent in the March 2020 quarter.
This was followed by the hospitality industries, with food and beverage services down 6.7 percent and accommodation down 9.3 percent.
“Efforts to slow the spread of COVID-19 led to the closure of all non-essential businesses from midnight March 25,” Ms Hicks said.
“This hit car yards, takeaways, restaurants, hotels and motels hard, with sales dropping sharply.
“These falls may continue 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.”
Spending halves during lockdown has more detail on retail card spending across the country in April.
“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,” Ms Hicks said.
International visitor arrivals to New Zealand March 2020 has more detail on changes in monthly international visitor arrival numbers in March.
These falls were offset by a record increase in supermarket and grocery stores, up 8.5 percent.
“Supermarkets stayed open during the level 4 COVID-19 lockdown as an essential business, and widespread reports stated people stocked up on food and supplies as the quarter progressed,” Ms Hicks said.
Sales values dampened by motor vehicles and hospitality
Including price changes, the seasonally adjusted value of total retail sales fell 0.4 percent ($89 million) in the March 2020 quarter, after a 0.5 percent ($120 million) rise in the December 2019 quarter.
Sales values for motor vehicle and parts retailing were down 7.4 percent ($248 million). This was followed by the two hospitality industries, food and beverage services, down 5.8 percent ($179 million) and accommodation, down 11 percent ($127 million).
Supermarkets and grocery stores had a record increase in sales value, up 9.7 percent ($514 million).
In actual terms, the value of total retail sales was $24.8 billion in the March 2020 quarter, up 3.4 percent ($819 million) from the March 2019 quarter.
Record sales slump in Otago
Retail sales fell the most in the Auckland and Otago regions in the March 2020 quarter.
“This coincided with border closures reducing overseas visitor arrivals and a fall in the number of foreign students coming to New Zealand for tertiary studies,” Ms Hicks said.
Travel restrictions hit the hospitality sector in tourist destinations such as Auckland, which is often the first port of call for many overseas visitors. The Auckland region had the largest dollar value fall this quarter, down 0.9 percent ($86 million).
Otago had the next largest fall in dollar terms, down 4.1 percent ($57 million). This quarter’s fall was the largest for Otago since the regional series began in June 2011.
“Otago’s fall in sales reflects the significant drop in overseas tourists to the Queenstown area, and fewer overseas and New Zealand students returning to Dunedin for university at the start of the year,” Ms Hicks said.
COVID-19 data portal provides economic, social, and health indicators including weekly traffic counts and fuel supply volumes.
Key border restrictions and COVID-19 Alert System timeline
2 February 2020: NZ Government places entry restrictions into New Zealand on all foreign nationals travelling from or transiting through mainland China.
19 March 2020: New Zealand’s borders closed to almost all travellers, except for returning New Zealanders.
23 March 2020: New Zealand enters COVID-19 alert level 3 (Restrict)
25 March 2020: New Zealand enters COVID-19 alert level 4 (Eliminate)