New vehicle sales in line with expectations, says Naamsa

Brian Joss – Commenting on the new vehicle sales statistics for April 2018 – the NAAMSA said the latest vehicle sales and export numbers had been in line with general industry expectations.  

The domestic sales total would probably increase by about 350 units once the delayed sales report by Fiat Chrysler Automobiles South Africa was received by around mid-May 2018.    The configuration of public holidays at the end of April, 2018, preceded by national industrial strike action, would have impacted on domestic sales.

Despite this, domestic new vehicle sales at 36 346 units showed an improvement of 1 260 vehicles or 3,6% from the 35 086 vehicles sold in April last year.  April 2018 aggregate export sales at 24 422 vehicles reflected an improvement of 193 units or a gain of 0,8% compared to the 24 229 vehicles  exported in April last year. 

Overall, out of the total reported Industry sales of 36 346 vehicles, an estimated 31 476 units or  86,6% represented dealer sales, an estimated 7,0% represented sales to the vehicle rental Industry,  5,1%  to industry corporate fleets and  1,3% to government. 

The April, 2018 new car market at 23 928 units had registered an improvement of 1 438 cars or a gain of 6,4% compared to the 22 490 new cars sold in April last year.  Seasonal factors had affected the car rental industry contribution but had still accounted for about 8,6% of new car sales in April, 2018.

Domestic sales of new light commercial vehicles, bakkies and mini buses had been marginally weaker and at 10 580 units during April, 2018 had registered a fall of 127 vehicles or a decline of 1,2 % compared to the 10 707  light commercial vehicles sold during the corresponding month last year. 

Sales in the low volume medium and heavy truck segments of the Industry reflected a mixed picture but had again remained under pressure and at 493 units and 1 345 units, respectively, had recorded a fall of 68 vehicles or a decline of  12,1%, in the case of medium commercial vehicles, and, in the case of heavy trucks and buses, a modest improvement of 17 vehicles or a gain of 1,3% compared to the corresponding month last year. 

Naamsa expected new vehicle sales to show steady improvement over the medium term due to further recovery in domestic demand supported by continued moderation in new vehicle price inflation, rising real disposable consumer income, recent improvement in South Africa’s political and policy environment, lower interest rates and the maintenance of an investment grade rating with a stable outlook by a major credit ratings agency.  As a result of these developments – reinforced by improved business and consumer confidence as well as increases in the Reserve Bank leading indicator – economic growth for 2018 could recover to around 2% and this in turn would benefit domestic new vehicle sales over the balance of the year and an annual improvement of domestic sales volumes of 3% plus compared to 2017 was expected.

Robust global growth should benefit new vehicle exports going forward.  Exports were expected to show substantial upward momentum in the months ahead.

CAPTION: Toyota Corollas: going under the hammer. New car sales grew by 3.6%

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