Positive macroeconomic growth will be one of the key factors influencing new vehicle sales next year, according to Naamsa’s annual report.

Positive macroeconomic growth will be one of the key factors influencing new vehicle sales next year, according to Naamsa’s annual report.

The report, released on Thursday, found that low interest rates and inflation would ensure that the current buoyant vehicle sales environment continued into 2005.

Tracking activities and trends in the automobile industry, the report says there is likely to be a ten per cent increase in vehicle sales next year, and that total vehicle sales this year will total 425 000. This is up from last year’s 368 470.

According to newspaper reports, manufacturing in 2004 is expected to top 459 000 units and increase by 15 per cent to 530 000 next year. The report found that under the Motor Industry Development Programme, vehicle exports have gone from just under 16 000 units in 1995, to more than 120 000 in 2004.

Local production growth last year, at 4,2 per cent, was greater than the international average of 2,9 per cent The report also noted that exporters would continue to be pressured by the rand’s strong performance while domestic vehicle price were likely to reflect “above average wage increases” and higher steel prices.

Naamsa found that over the past five years, employment within the industry had grown by a steady rate, despite some losses in the production and component sectors. Projected rises in production for 2005 could see more jobs created in the industry as well.