WesBank says that the recent “positive turnaround” in South Africa’s new vehicle sales is being driven by “superlative marketing incentives” from dealers.
The latest statistics from Naamsa show that 50 675 new vehicles were sold across all segments in South Africa in September 2017, representing year-on-year sales growth of 7,0%.
And WesBank says the data indicates that “consumer-buying patterns” were responsible for this positive performance. Within the dealer channel, which WesBank says grew 6,3%, passenger car sales volumes grew 10,3% while sales of light commercial vehicles rose 5,3%.
“This remarkable recovery in the new vehicle market is being made possible by superlative marketing incentives from manufacturers,” said Rudolf Mahoney, head of brand and communication at Wesbank.
“Right now, new vehicle deals are just that much more attractive than buying used, and consumers are seeing the value.”
WesBank says its data points to “value for money” as the sales driver behind September’s performance. Average deal values for new vehicles, in fact, were in decline.
While new vehicle price inflation has slowed, the vehicles’ prices have not declined. Compared to the previous month, September’s average new vehicle finance transaction value was 1,1% lower – something WesBank describes as “a clear indication that manufacturers are giving so much back to the consumer to the extent that the average transaction value has come down”.
In contrast, WesBank says the supply of quality used vehicles is drying up, which has resulted in continued price inflation. Used vehicle finance deal values have risen 8,4%, year-on-year, and show no real signs of slowing down – climbing 2,5% in the past three months.
“When looking at the macroeconomic indicators over the past few months, we see some stability. However, it’s not all plain sailing for car buyers and motorists,” warned Mahoney.
“The cost of mobility is rising sharply, in keeping with the recent months’ rapidly escalating fuel prices, and contributing to a negative outlook for the remainder of the year. It, once again, shows that consumers should leave breathing room in their budgets to accommodate increases over the duration of their finance contract.”
