The latest figures released by the National Association of Automobile Manufacturers of South Africa (NAAMSA)|Automotive Business Council paint a surprisingly optimistic picture of the new vehicle market in South Africa, with sales recording a double-digit growth in June despite some of the worst levels of rolling blackouts the country has experienced.
In June new vehicle sales came in at 46,810 units, up 14% compared to the same month last year, according to figures released by NAAMSA, the Automotive Business Council.
The month’s performance was bolstered significantly by 5,070 additional Light Commercial Vehicle (LCV) sales, with the segment displaying 57.1% growth.
The passenger car market reported a 0.8% increase year-on-year to 29,795 units. The soft performance of this segment is reflected in first-half sales being 1.7% down on the first six months of 2022, at 173,943 cars.
In contrast, LCV sales – albeit not as spectacular as June sales – were 20.3% ahead of the first-half last year at 76,519 units. The rental market also contributed 4,662 units, indicating a need for replacement stock in the segment.
All these contributing sectors result in a reassuring overall picture for the market.
According to the latest statistics, sales are up 4.8% year-to-date, keeping pace with the market’s slow recovery.
According to Lebo Gaoaketse, Head of Marketing and Communications at WesBank, this sector of the economy is proving to be almost counter-cyclical, with positive growth rates out-performing most other sectors.
“It is clear to see the correlation between actual market performance and demand levels measured by applications for financing, which are now firmly driving new vehicle deals as opposed to pre-owned purchases,” said Gaoaketse.
The data seems to suggest that the economy is in a far healthier state than the broad perception might give it credit for, providing a spark of hope for both business and consumers during these challenging times.
This is evidenced by the fact that new vehicle sales have already out-performed last year’s first-half figures, and petrol price reductions on Wednesday – the second set of decreases since June – have also been put into place, creating more affordability for motorists.
As Gaoaketse mentioned, “more stable fuel prices, hopefully fewer (if any) interest rate changes, first-half growth for the manufacturing sector as well as a strong recovery in exchange rates will all contribute to economic performance as a whole during the second half.”
Gaoaketse added that it appears the outlook for South Africa’s new vehicle market is looking far more optimistic than expected – a refreshing breath of positivity in these uncertain times.