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Good news for SA! Car sales expected to rise in 2018 - Naamsa

2018-04-04 08:33

Image: iStock

Johannesburg - Despite fewer selling days in March due to public holidays, the new vehicle industry made an upward swing, with a total of 49 233 new vehicles sold reflecting a growth of 1.1% year-on-year.

Overall, out of the total reported industry sales of 49 233 vehicles, an estimated 44 417 units or 90.2% represented dealer sales, an estimated 5.3% represented sales to the vehicle rental Industry, 2.7% to industry corporate fleets and 1.8% to government.

Market outlook for SA

The National Association of Automobile Manufacturers of South Africa said: "Medium term prospects for the South African economy has improved considerably on the back of the decision by Moody’s to retain South Africa’s international and domestic credit rating at investment grade with a stable outlook as well as the 0.25% reduction in official interest rate at the end of March, 2018.  In addition, the continuing strength in the exchange rate should impact positively on new vehicle price inflation going forward. 

"As a result of these developments – together with improved business and consumer confidence – economic growth for 2018 could recover to around 2% and this in turn would benefit domestic new vehicle sales over the balance of the year.  At this stage, Naamsa anticipate that, on an annualised basis, new vehicle sales could improve by around 3%, in volume terms, compared to 2017."  

What about the year ahead?

Naamsa said: "The outlook for the global economy was one of fairly strong growth which should benefit new vehicle exports going forward. Factoring the impact of model run out and model run in on the part of one major exporter, a modest increase in annual vehicle export sales volumes is still possible in 2018."  

Growth for SA car sales

Ghana Msibi, WesBank’s executive head for sales and marketing, says: "Following the budget speech indicating an increase in VAT and ad valorem tax from April 1, it is our view that consumers opted to avoid the increases these factors will have on vehicle purchase prices. These, combined with the renewed consumer and business confidence, and a reduction in the repo rate contributed to the growth in the passenger car segment."

Read more on:    wesbank  |  naamsa  |  wheels24  |  new models  |  new vehicles  |  car sales

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