Gauging from the buoyant December new vehicle sales figures, and the market’s continued strength throughout 2004, it comes as little surprise that the local market was internationally one of the best performers last year.

:: Click here for complete new vehicle sales figures in South Africa during December ::

Gauging from the buoyant December new vehicle sales figures, and the market’s continued strength throughout 2004, it comes as little surprise that the local market was internationally one of the best performers last year.

Sales in all four segments reflected significant increases as a total of 35 971 new vehicle units were reported sold in December 2004, an improvement of 9 882 (37,9 per cent) over the same period in the previous year.

December 2004 reflected the highest December total on record since 1981 with passenger car sales of 24 578 units, a gain of 38,5 per cent compared with the 17 740 new units sold in December 2003.

In its best December total on record, 9 875 light commercial vehicles, bakkies and minibuses were sold, reflecting an improvement of 38,1 per cent compared with just more than 7 000 units sold during December 2003.

Medium and heavy truck sales showed an increase of 25,6 per cent and 27,3 per cent respectively compared with the previous year’s figures. The medium commercial vehicle sales for the month too reflected the highest December sales figures on record.

While Naamsa optimistically predicted runaway new vehicles sales at the start of 2004, it has admitted that even these estimations have been surpassed. In 2004 as a whole, Naamsa reported sales to have improved by 22 per cent, from 368 470 units in 2003 to 449 603.

However, figures for the several manufacturers running export programmes should only be available by the middle of January. These volumes are expected to be hard-hit by the influence of the strong rand and highly competitive global market conditions.

Good news though, is that South Africa has become firmly established in its role as a manufacturer and supplier of automotive components, and should play a bigger role in 2005 as more export programmes are implemented. Overall production output is expected to rise to more than 500 000 units in 2005, compared with the 459 000 units produced in 2004.

The positive growth trend in the new vehicle market should continue in 2005, with great potential for the market’s overall sales to increase by more than ten per cent.

Domestically, a number of favourable economic conditions should support the momentum and demand for new vehicles this year. These include strong consumer sentiment and business confidence, low inflation coupled with prospects of further interest rate cuts, and possible sustained gross domestic product growth in excess of four per cent per annum.

However, some factors could also negatively influence the market, including the stronger Rand’s influence on exports and a drop-off in real personal disposable income. Lower vehicle trade-in values and increased pressure on the used car market could also affect demand for new cars.

:: Click here for complete new vehicle sales figures in South Africa during December ::