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- New vehicle sales declined by 8.9% in January 2018
- 45 888 vehicles sold
- LCV – 11 689 units, -2.1%
- New vehicle exports increased by 22%, 14 212 units
Johannesburg - New vehicle sales started the year on a weak note with overall sales of 45 888, a decline of 4498 units or 8.9% from the 50 386 vehicles sold in January 2017, reports Naamsa.
In contrast, January, 2018 export sales at 14 212 vehicles had registered a substantial improvement of 2 561 units or a gain of 22.0% compared to the 11 651 vehicles exported in January last year.
Best-selling cars: Outgoing Polo Vivo takes top spot in January
Overall, out of the total 45 888 vehicles sold, an estimated 35 824 units or 78.1% represented dealer sales, an estimated 17.3% represented sales to the vehicle rental Industry, 2.7% to industry corporate fleets and 1.9% to government.
The new car market (32 642 units) registered a drop of 4266 cars or -11.6%, compared to the 36 908 new cars sold in January last year.
The car rental Industry continued to make a major contribution accounting for about 23.1% of new car sales in January, 2018 – one in every five new cars sold during the month represented a car rental sale.
Bakkie market
New light commercial vehicles, bakkies and mini buses at 11 689 units during January reflected a decline of 251 vehicles or -2.1%, compared to the 11 940 LCVs sold in January 2017.
Why the decline in sales?
Naamsa said: "The figures continued to reflect subdued investment sentiment in the economy. Ongoing improvement in the Reserve Bank’s leading indicator and the substantial increase in the latest Purchasing Manager’s Index, anticipate enhanced economic conditions over the medium term. The considerable appreciation in the value of the Rand will reduce inflationary pressures and serve to enhance consumers’ disposable income.
"Combined with the recent positive political developments and improved business confidence, it is possible for economic growth in 2018 to surpass current expectations. However, much will depend on the February 2018 budget and governments’ commitment to disciplined fiscal management and limiting government expenditure as well as ensuring State Owned Enterprises are subjected to strict governance and operate according to sound business principles."
Trends for 2018
Naamsa said: "On the assumption that South Africa will avoid a further downgrade during the first quarter of 2018, NAAMSA anticipates that economic growth could recover to a level above 1.5% in 2018. This would benefit new vehicle sales in particular which could then expand to levels above the 2% to 4% growth projected at the beginning of this year.
"New vehicle price inflation, assisted by the stronger Rand, was currently at an annualised rate of around 2.5%, well below the inflation rate, and this, together with continued replacement demand, would serve to support new vehicle sales in the months ahead. New vehicle exports in 2018 were expected to show fairly strong upward momentum on the back of improved growth in the global economy. At this stage, an increase of about 11% to a total of 366 050 export sales was anticipated for the year."
