Vehicle sales slump in ailing economy
THE Automotive Business Council (Naamsa) has released new vehicle sales figures for March and, from an economic perspective, things don't look good.
Last month was the South African new vehicle industry’s eight consecutive month of year-on-year decline, with total market sales falling 11.7% to 44 237 units.
That figure furthermore represented a 1.1% drop compared with February's figures.
According to Naamsa, the market’s overall performance was impacted by a 'constrained business environment amplified by weak consumer demand', as well as the recent Easter holidays (the latter resulting in fewer trading days).
Of the total reported industry sales last month, Naamsa estimated that 39 016 units (or 88.2%) represented registrations via the dealer channel, while 6.0% were sales to the vehicle rental industry, 3.5% to government and 2.3% to industry corporate fleets.
March's new passenger vehicle market registered a 15.9% year-on-year drop to 26 577 units, with rental sales accounting for 7.8% of that total.
Even the country’s typically robust light commercial vehicle segment wasn’t spared, with bakkie sales declining 4.3% year-onyear to 14 870 units.
Despite the overall negative sentiment, it was another bumper month for Toyota (including the Lexus and Hino marques), which was once again South Africa’s bestselling automaker last month.
Toyota SA Motors registered as many as 11 109 units (4 352 of which were in the light commercial vehicle segment), just 3.6% down on its February showing.
March's top 10 brands:
1. Toyota – 11 109 units
2. Volkswagen Group – 5 219
3. Suzuki – 4 335
4. Nissan – 3 995
5. Isuzu – 2 587
6. Hyundai – 2 436
7. Ford – 2 409
8. GWM – 1 564
9. Chery – 1 531
10. Renault – 1 301
So what lies ahead for South Africa's new vehicle market?
Naamsa suggests the market looks set to decline further, but believes 'better economic prospects are expected for the new vehicle market' once the anticipated interest rate cutting cycle commences – likely only during the second half of the year.
“Due to ongoing cost pressures, including escalating fuel costs, together with interest rates, affordability remains a decisive factor in purchasing decisions as consumers increasingly turn to more budget-friendly vehicles,” says Naamsa, adding that SA’s economic growth outlook for 2024 remains 'muted'.