The National Association of Automobile Manufacturers of South Africa (Naamsa) has today released its new vehicle sales figures for February. The report finds that while new car sales continue to feel the pressures of inflation and high interest rates, the commercial vehicle market continues to flourish.
Aggregate combined new vehicle sales at 46 248 units compared to the 52 526 vehicles sold during February 2007, marking a decline of 6 278 units or 12 percent. Taking account of sales not reported in detail to NAAMSA, total aggregate sales declined by 13,5 percent.
Rising inflationary pressures, high levels of personal debt and interest rate hikes have seen new car sales for the month of February drop from 32 272 units in the corresponding month of last year to 27 505 units this year – a decline of 4 767 units or 14,8 percent.
Out of the total reported industry sales of 46 248 vehicles 87,3 percent comprised dealer/retail sales, 5 percent were sales to the car rental industry, 3,3 percent were sales to government and 4,4 percent were represented by sales into Naamsa member company fleets.
The industry has seen a strong upswing in the medium and heavy commercial vehicle and export sectors, however. Supported by strong investment sentiment and infrastructural spending, sales of vehicles in the medium and heavy truck segments maintained their strong upward momentum and the February, 2008 sales at 1 262 units and 1 967 units, improving 27 units or 2,2 percent, in the case of medium commercials, and 325 units or 19,8 percent, in the case of heavy trucks and buses – compared to last year’s figures.
February 2008 presented the best performing month on record for new vehicle export sales with 20 631 units sold. This is a significant improvement of 3 895 vehicles or 23,3 percent over the 16 736 vehicles exported during the corresponding month last year. Naamsa anticipates that the record growth in exports for 2008 will benefit the South African vehicle and component industry’s production volumes and the country’s overall trade balance, increasing the automotive sector’s overall contribution to the country’s GDP.
It wasn’t all good news on the commercial front, however. Sales of new light commercial vehicles, bakkies and minibuses were placed under the same economic pressures as the passenger vehicle market and showed a decline of 10, 7 percent to 15 514 units, compared to the 17 377 unit sales of the corresponding month last year.
Naamsa’s long term view is a positive one. The reduction in the corporate tax rate to 28 percent, the emphasis on supply side measures to boost the productive capacity of the South African economy, the proposed adjustment to personal income tax and car travel allowances to compensate for inflation, and the additional infrastructure investment allocations in the recently announced budget was expected to support savings, investment and future economic growth and would therefore positively influence new vehicle sales over the medium to long term. In the short term, however, new car and light commercial vehicle sales are likely to remain under pressure as a result of high interest rates, a slowdown in economic activity and new vehicle price inflation.
To view the Naamsa new vehicle sales figures for February 2008, click here.
