Download the full document here.

Commenting on the new vehicle sales statistics for the month of May 2018, Naamsa said that the latest vehicle sales and export numbers had "continued in line with general industry expectations". In the event, new vehicle sales at 42 984 had shown an improvement of 1 022 vehicles or 2,4% from the 41 962 vehicles sold in May last year. May 2018 aggregate export sales at 32 731 vehicles reflected an improvement of 3 982 units or a gain of 13,9% compared to the 28 749 vehicles exported in May last year.

Overall, out of the total reported industry sales of 42 984 vehicles, an estimated 37 370 units or 87,0% represented dealer sales, an estimated 7,3% represented sales to the vehicle rental industry, 3,7% to industry corporate fleets and 2% to government.

The May 2018 new car market at 26 561 units had registered a marginal improvement of 179 cars or a gain of 0,7% compared to the 26 382 new cars sold in May last year. Seasonal factors continued to affect the car rental industry contribution which had accounted for about 9,8% of new car sales in May 2018.

Domestic sales of new light commercial vehicles, bakkies and mini buses had improved modestly and at 13 977 units during May 2018 had registered a gain of 434 vehicles or  3,2% compared to the 13 543 light commercial vehicles sold during the corresponding month last year.

Sales in the low volume medium and heavy truck segments of the Industry had rebounded strongly and at 694 units and 1 752 units, respectively, had recorded an increase of 104 vehicles or a gain of 17,6%, in the case of medium commercial vehicles, and, in the case of heavy trucks and buses, a sharp improvement of 305 vehicles or a gain of 21,1% compared to the corresponding month last year.

The improved truck sales figures suggested the return of positive investment sentiment and business confidence.

Naamsa's expectations going forward remained unchanged, namely, new vehicle sales should show a gradual improvement over the medium term due to further recovery in domestic demand supported by continued moderation in new vehicle price inflation, the improvement in South Africa’s political and policy environment, the March 2018 reduction in interest rates and unchanged international credit ratings.

As a result of these developments, supported by improved business and consumer confidence, a modest recovery in economic growth in 2018 and 2019 was anticipated. This in turn would benefit domestic new vehicle sales over the balance of the year and an annual improvement in domestic sales volumes of 3% plus compared to 2017 was possible.

Robust global growth should benefit new vehicle exports going forward. However, the current wave of protectionism could negatively impact on the global economy. Despite this, exports should show further upward momentum in the months ahead.