The National Association of Automobile Manufacturers of South Africa (Naamsa) today commented that new vehicle sales for the month of August were largely in line with industy expectations, continuing the moderate aggregate growth pattern on the last four years – despite industry-wide industrial action that has now entered its third week.
Year to date sales still showed an improvement of 5,9 per cent compared to the corresponding months of 2012, with the aggregate industry sales of 56 115 units for August 2013 actually 0,3 per cent (155 vehicles) down from the 56 270 units sold during August last year. Thanks to inventory levels, the industry strike’s impact to domestic sales was kept to a minimum. Export sales bore the brunt of the industrial action last month, especially those of Ford and BMW, with a total decline of 22 per cent volume.
Of the total reported industry sales of 56 112 vehicles, 46 442 units (82,8 per cent) represented dealer sales, 11,4 per cent represented sales to the vehicle rental industry, 3,3 per cent to industry corporate fleets and 2,5 per cent to government.
In particular, the strong sales performance of medium and heavy vehicle segments, with 1 038 and 1 809 units moved respectively (increases of 24 and 28,8 per cent) have been attributed to increased investment spending in South Africa, as well as countrywide infrastructure development projects.
But with the current strike at the seven major manufacturing plants in South Africa, and even lower numbers predicted for September, all eyes are on the export market, especially with more production losses at hand. Unfortunately, South African’s reputation as a reliable supplier to international export markets could severely be affected if the current industrial action isn’t settled within the next few days, as labour stability was a key consideration for companies to allocate vehicles for production locally.
The outlook remains positive for the rest of the year however, with a prevailing low interest rate environment, a highly competitive trading segment, ongoing attractive incentives and high technology new model introductions key components of continued industry growth.