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Johannesburg - Irregularity in new vehicle sales numbers continues to contribute to market uncertainty, says WesBank.
According to aggregated data from the National Association of Automobile Manufacturers of South Africa (Naamsa), April’s sales of 36 346 units reflect a 3.6% year on year growth, while at the same time showing a dramatic month on month decline of 26.2%.
Naamsa said: "The domestic sales total would probably increase by about 350 units once the delayed sales report by Fiat Chrysler Automobiles South Africa was received by around mid-May 2018."
Export sales at 24 422 vehicles reflect an improvement of 193 units (0.8%) compared to the 24 229 vehicles exported in April 2017.
'Market uncertainty'
Rudolf Mahoney, WesBank’s Head of Brand and Communications, said: "It’s important to not read too much into these figures as the overall picture is skewed by the dip in sales observed in April 2017 as a result of the country’s downgrade to junk status at the time.
"As a result, the 3.6% increase in sales in April is not as positive a picture as it may seem.
"Looking at the month to month decline, this is a result of the stronger sales in March, thanks to consumers opting to avoid an increase in VAT and ad valorem which came into effect on 1 April. A more practical indication of the market’s performance this year is the year-to-date decline of 2.6%."
Naamsa said: "Naamsa expects new vehicle sales to show steady improvement over the medium term due to further recovery in domestic demand supported by continued moderation in new vehicle price inflation, rising real disposable consumer income, recent improvement in South Africa’s political and policy environment, lower interest rates and the maintenance of an investment grade rating with a stable outlook by a major credit ratings agency.
"As a result of these developments - reinforced by improved business and consumer confidence as well as increases in the Reserve Bank leading indicator – 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 and an annual improvement of domestic sales volumes of 3% plus compared to 2017 was expected.
"Robust global growth should benefit new vehicle exports going forward. Exports were expected to show substantial upward momentum in the months ahead."
Sales breakdown
New car sales
The April, 2018 new car market at 23 928 units had registered an improvement of 1438 cars (+6.4%) compared to the 22 490 new cars sold in April last year. Naamsa said: "Seasonal factors had affected the car rental industry contribution but had still accounted for about 8.6% of new car sales in April."
Bakkies and busses
Domestic sales of new light commercial vehicles, bakkies and mini buses had been marginally weaker and at 10 580 units during April 2018 registered a decline of 127 vehicles (-1.2%) compared to the 10 707 light commercial vehicles sold during the corresponding month last year.
