In amplification of the new vehicle sales statistics for the month of October, 2013 – released today for public consumption via the website of the Department of Trade & Industry – the Association commented that the latest new vehicle sales data continued to reflect the impact of the September, 2013 / October, 2013 automotive Industry strike.
In particular, the impact of the industrial action had been reflected in the September vehicle export numbers which had recorded a year on year monthly decline of 75.1%, whilst the October, 2013 export figures reflected some recovery – as manufacturers resumed and normalised vehicle production from about the middle of the month – with aggregate October, 2013 export sales showing a decline of 15.1% and overall domestic sales declining by 2.9% in volume terms compared to the corresponding month last year.
After four years of growth in the domestic market, aggregate new vehicle sales had continued to show lower growth momentum in recent months. In the event, year to date domestic sales showed an improvement of 3.9% compared to the corresponding ten months of 2012. Aggregate Industry sales of 56 927 units for October, 2013 reflected a decline of 2.9% or 1 704 vehicles from the 58 631 units sold in October last year.
Overall, out of the total reported Industry sales of 56 927 vehicles, about 45 692 units or 80.1% represented dealer sales, 12.9% represented sales to the vehicle rental Industry, 3.8% to Industry corporate fleets and 3.2% to government.
During October, 2013 a total of 40 102 new cars were sold which represented a decline of 1 860 units or fall of 4.4% compared to the 41 962 new cars sold in October last year. The car rental industry had contributed positively to the October sales numbers and accounted for 17.4% of new cars sold during the month.
Domestic sales of industry new light commercial vehicles, bakkies and mini buses at 14 125 units during October, 2013 reflected a marginal improvement of 24 units or 0.2% compared to the 14 101 light commercial vehicles sold during the corresponding month last year.
Sales of vehicles in the medium and heavy truck segments of the Industry at 996 units and 1 704 units, respectively, had recorded an increase of 95 units or 10.5% in the case of medium commercial vehicles, and an increase of 37 units or 2.2% in the case of heavy trucks and buses – compared to the corresponding month last year.
Industry new vehicle exports during October, 2013 at 21 125 vehicles had registered a substantial decline of 3 767 units or a fall of 15.1% compared to the 24 892 vehicles exported in October last year. This was largely due to the auto sector strike with exports of light commercial vehicles, in particular, being adversely affected. As a result, the original industry projection for 2013 of vehicle exports of 336 000 units was likely to be revised downwards to about 290 000 units for the year. The momentum of vehicle exports should however improve in 2014 as export programmes were ramped up and particularly exports of light commercial vehicles were expected to increase substantially in the new year.
Domestically, expectations of lower economic growth and above-inflation new vehicle price increases would contribute to a more difficult trading environment and further moderation in sales growth momentum. Despite a less promising outlook for the automotive sector, the year as a whole would still represent the second or third best year on record in terms of domestic sales. The prevailing low interest rate environment should lend some support to the domestic market together with replacement demand, the highly competitive trading environment, attractive incentives and high technology new model introductions. Export sales would remain a function of the performance and direction of global markets with some regions notably North America, Africa and Asia offering above average growth opportunities.
Additional note
An additional and important change relates to the export units reported by Ford Motor Company of SA where an additional 3 063 export vehicles are now included for October, 2013.
As a result, Industry total export vehicles during October, 2013 now totals 24 188 units which represents a relatively modest decline of 709 vehicle exports or a fall of 2.8% compared to the 24 897 vehicles exported in October last year. The revised, higher vehicle export number reflects good recovery in production by manufacturers upon resumption of operations from about 7th October, 2013 – following the seven week automotive Industry industrial action.
The momentum of vehicle exports is expected to improve substantially in 2014 particularly on the back of higher expected light commercial vehicle export numbers. However, as a result of the industrial action experienced from the middle of August to the first week of October, 2013 – original Industry projections for 2013 vehicle exports of 336 000 would be reduced to about 290 000 for the year.
