SA vehicle exports set to hit high road
Sales drop within Africa during 2016
SALES of new motor vehicles across Africa may be bottoming out after years of decline, said Mike Whitfield, president of the National Association of Automobile Manufacturers of SA.
A report by the Automotive Industry Export Council (AIEC) released at the weekend showed trade in South African vehicles and components with the rest of the world hit new peaks in 2016.
Though the local industry continued to record an overall trade deficit of R32.9-billion – R204.1-billion in imports against R171.1-billion in exports – the gap was down sharply from R45.2-billion a year earlier and R62.2-billion in 2015.
Many of those imports were aftermarket vehicle parts. If they are taken out of the equation, it could be argued local vehicle and components companies recorded a surplus.
The AIEC report shows that if one only records trade done through the manufacturing-based Automotive Production and Development Programme, the industry exported R23.2-billion more than it imported: R171.1-billion against R147.9-billion.
Components companies exported a record R53-billion in goods in 2016.
Renai Moothilal, director of the National Association of Automotive Component and Allied Manufacturers, said the figure was “okay” but that all sectors of the local industry had to work together to increase global penetration.
The big trade balance boost came from vehicles. The shrinking domestic market for new vehicles limited imports but exports achieved a new record of 344 859 in 2016, a figure that Norman Lamprecht, compiler of the AIEC report, believes will be exceeded in 2017.
Most of 2016’s vehicle export growth was to Europe and Asia. Germany – represented in SA by BMW, Mercedes-Benz and Volkswagen and several of the major components companies – remained the biggest trade partner.
Total trade of R116.5-billion was made up of R46.8-billion in exports and R69.7-billion in imports.
Second was the R34.1-billion in trade with the US. Here, at least, SA boasted a trade surplus: R22.6-billion in exports against R11.5-billion in imports.
The big disappointment was Africa. Though SA’s trade surplus – R28.7-billion – was the biggest of any region’s, 2016 exports to the rest of the continent fell 49% compared to a year earlier, from 42 234 to 21 564. That is a drop of almost 75% in four years, from 80 293 in 2012.
Plunging oil and commodities prices, allied to a lack of foreign exchange, have eroded governments and consumers’ spending power. The dominance of dumped used vehicles is also a challenge.
Whitfield, whose own company, Nissan SA, relies heavily on Africa for export volumes, said some markets were so slow companies were able to service them with vehicle stock already in the country.
He predicted South African exports to Africa in 2017, compared to 2016, “will be very flat and will then start to show progress”. — TMG