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Car sales still stymied by strikes

2013-11-04 09:43

ONGOING BATTLE: Vehicle sales has improved during October 2013, including those of the Chevrolet Spark, but the recent strikes in the auto industry has still produced low volumes for vehicle exports. Image: Chevrolet

The South African automotive industry strike dealt a heavy blow to the market and cut vehicle exports by 75% in September but a glimmer of hope peeped back in the October sales stats.

Johannesburg - September's strike in the SA auto industry affected vehicle exports to the extent of a year-on-year decline of 75% during that month but there was some recovery in October. The work stoppage cost the country's automakers 50 000 cars in lost production and affected export numbers significantly.

The National Association of Automobile Manufacturers of SA said on Nov 1: "Industry new vehicle exports during October 2013 (21 125) were down by 3767 or 15% from the 24 892 exported in October 2012. This was largely due to the auto sector strike, with exports of light commercial vehicles, in particular, adversely affected."

As a result the original 2013 industry projection of vehicle exports of 336 000 units would likely be revised downwards to about 290 000 for the year.

RECOVERY IN PROCESS

Naamsa said the October export figures recovered as manufacturers resumed normal vehicle production mid-month but October's domestic sales declined by 2.9% from the October 2012. Export momentum was expected to improve in 2014 as export programmes increased, particularly light commercial vehicles which are expected to increase substantially.

The company reported: "After four years of growth in the domestic market, aggregated new vehicle sales continued to show slower growth in recent months. In the event, year-to-date domestic sales showed an improvement of 3.9% compared to the first 10 months of 2012."

Aggregated industry sales of 56 927 for October 2013 were down by three percent (1704 ) from the 58 631 sold in October 2012. Of the total reported sales, 80% were to dealers, 13% to rental companies, 3.8% to corporate fleets and 3.2% to the state.

STILL CLOSE TO RECORD YEARS

So, 40 102 new cars were sold in October down 4.4% or 1860 from the 41 962 of a year earlier. Domestic sales of new light commercials, bakkies and minibuses improved by 0.2% to 14 125. Medium and heavy truck sales also showed a slight increase.

"Domestically, expectations of lower economic growth and above-inflation new vehicle price increases would contribute to a more difficult trading environment and further moderation in sales growth momentum," Naamsa warned. "Despite a less-promising outlook for the automotive sector, the year as a whole should still be the second or third-best year on record for domestic sales."

Naamsa said the current interest rate should lend some support to the domestic market together with the replacement demand, the highly competitive trading environment, attractive incentives and high-technology model introductions.

Export sales would remain a function of the performance and direction of global markets.
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Read more on:    south africa  |  auto industry  |  car sales  |  exports

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