Car in­dus­try sit­ting pretty

Leisure Wheels (South Africa) - - BUYERS GUIDE -

NA­TIONAL As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers (Naamsa) re­cently re­leased its quar­terly re­view of busi­ness con­di­tions in the new ve­hi­cle mo­tor man­u­fac­tur­ing in­dus­try for the sec­ond quar­ter of 2018.

De­spite in­di­vid­u­als fac­ing a tough time with per­son­alised mo­tor­ing, given the fuel price and rough eco­nomic times in gen­eral, the man­u­fac­tur­ing in­dus­try is do­ing rather well.

Over the last few months we’ve seen loads of good news on this page, in­clud­ing large lo­cal in­vest­ments from Mahin­dra and BAIC.

Ford is the lat­est mem­ber to join the club af­ter a R3 bil­lion in­vest­ment in its Sil­ver­ton plant ear­lier this year. The rea­son for this up­grade came to light re­cently when it was an­nounced that the Sil­ver­ton plant would be re­spon­si­ble for build­ing the high per­for­mance Ranger Rap­tor, specif­i­cally for the Euro­pean mar­ket.

This is not only a feather in Ford’s cap, but a com­pli­ment to South African assem­bly in gen­eral. It’s nice to know that the South African work­force is trusted enough to assem­ble ve­hi­cles for an au­di­ence as big and as fo­cused on qual­ity as Europe.

As for Naamsa’s re­port span­ning the en­tirety of mo­tor man­u­fac­tur­ing in SA, the news is (for the most part) good.

Em­ploy­ment is down, but only by 0.23% or 72 jobs. Ag­gre­gate In­dus­try em­ploy­ment as at 30 June, 2018 to­talled 29 960, re­flect­ing a de­crease of 72 jobs or a de­cline of 0.23% com­pared to the 30 032 in­dus­try head count as at the end of March 2018.

The av­er­age monthly in­dus­try em­ploy­ment num­ber for 2017 was 30 050.

Sec­ond quar­ter ag­gre­gate in­dus­try new car sales at 80 428 units recorded an im­prove­ment of 2 931 units or a gain of 3.8% com­pared to the 77 497 new cars sold dur­ing the cor­re­spond­ing quar­ter of 2017. Ag­gre­gate in­dus­try com­mer­cial ve­hi­cle sales dur­ing the sec­ond quar­ter of 2018 at 45 713 units recorded an in­crease of 830 units or a gain of 1.8% com­pared to the 44 883 units sold dur­ing the sec­ond quar­ter of 2017.

De­spite chal­leng­ing trad­ing con­di­tions, sec­ond quar­ter 2018 do­mes­tic sales held up rel­a­tively well with car rental busi­ness con­tribut­ing pos­i­tively.

The March 2018 0.25% in­ter­est rate re­duc­tion, sur­pris­ingly high con­sumer con­fi­dence and fur­ther im­prove­ment in new ve­hi­cle af­ford­abil­ity with av­er­age new car price in­creases well be­low the in­fla­tion rate for the fourth con­sec­u­tive quar­ter should pro­vide sup­port for do­mes­tic sales go­ing for­ward.

Ac­cord­ing to Naamsa, prospects for the short to medium term sug­gest do­mes­tic sales could im­prove mod­estly by be­tween 2% and 3% in vol­ume terms.

South Africa’s ex­ports are set to be in­flu­enced by global growth fore­casts, which are cur­rently around 3.7% but re­cent trade dis­putes mean there is a cer­tain amount of un­cer­tainty hang­ing in the air.

The ex­port num­bers have also been im­pacted by model run-outs and model runins as well as tech­nol­ogy driv­e­train tim­ing de­lays at one of the plants. As a re­sult, an­nual in­dus­try ve­hi­cle ex­port pro­jec­tions for 2018 had been re­vised down­wards.

In­for­ma­tion pro­vided to Naamsa by ve­hi­cle ex­porters in­di­cate that or­der books re­mained fairly strong and that ve­hi­cle ex­ports are ex­pected to start im­prov­ing over the rest of 2018 and go­ing for­ward into 2019.

Top: The Ford plant in Sil­ver­ton re­cently achieved an im­pres­sive mile­stone by build­ing the 500 000th Ranger. Above: The Sil­ver­ton plant will now be re­spon­si­ble for build­ing Ranger Rap­tors for the Euro­pean mar­ket.

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