The new vehicles sales statistics for the month of January, especially that of passenger cars and light commercial vehicles shows positive growth for the beginning of 2010, compared with the same period last year, despite continued sales declines in the medium and heavy commercial vehicle segments according to the latest Naamsa report.
Total industry sales have improved by 5 112 units or 15,5 per cent to 38 075 units from 32 963 in January last year, which experienced a significant decline in demand as a result of the global economic crisis.
Overall, out of the total NAAMSA reported industry sales of 34 113 vehicles, 80,8 per cent or 27 558 units represented dealer/retail sales, 10,2% represented sales to the car rental industry, 5,4 per cent industry corporate fleet sales and 3,5 per cent sales to Government.
Aggregate industry new car sales during January 2010 had exceeded expectations and at 27 008 units reflected a welcome improvement of 4 518 units or 20 per cent compared to the 22 490 new cars sold during January 2009.
Sales of industry new light commercial vehicles, pick-ups and minibuses at 9 805 units during January 2010 reflected an improvement of 864 units or 9,7 per cent compared to the 8 941 units of the corresponding month last year.
Sales of vehicles in the medium and heavy truck segments of the industry had started the year on weak note and the January 2010 sales at 452 units and 810 units, respectively, had recorded declines of 134 units or 22,8 per cent, in the case of medium commercials, and 136 units or 14,4 per cent in the case of heavy trucks and buses – compared to the corresponding month last year. Bus sales had however expanded year on year by 37,2 per cent in volume terms.
Due to inventory constraints, production, shipping and timing issues – exports of South African produced motor vehicles during January 2010 at 9 130 vehicles had registered a decline of 1 585 units or 14,8 per cent compared to the 10 715 vehicles exported during January last year.
From an international perspective, clear signs had emerged of a revival in demand for South African produced motor vehicles in foreign markets. With all of the local manufacturing plants back in production since the middle of January, export sales were expected to improve from February onwards. At this stage manufacturer’s projections suggested that overall industry export sales could grow by about 32 per cent from last year’s level of 174 952 vehicles.
The future direction of new vehicle sales would be determined by underlying economic fundamentals. The cumulative 5 per cent decline in interest rates between the end of 2008 and August 2009 should contribute to an improvement in the financial position of households and businesses and stimulate demand for new vehicles.
Other factors which would influence vehicle sales positively during 2010 included expected economic growth of 2 per cent plus, the 2010 Soccer World Cup Event which would boost demand by the car rental industry, promote tourism and spending, improved vehicle supply and enhanced new vehicle affordability on the back of relatively stable new vehicle pricing.
“The market should be careful not to become over-zealous by the strong numbers. January figures remain skewed by delayed purchase decisions out of 2009. While there is clearly growth being experienced, and what many industry players are planning for in their forecasts, February will display a better indication of where the market may progress to,” warns Jacques Brent, vice president of Marketing, Sales and Service, Ford Motor Company of Southern Africa.
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