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2018-07-06 09:47

Lance Branquinho

Image: AutoTrader SA / Lawrence Minnie

With the first two quarters of economic activity journaled, South African car sales reveal an interesting pattern at the halfway mark of 2018.

Fuel prices are escalating, which should in theory punish model lines which only offer larger capacity engines, yet interest rates have remained relatively benign, with only a slight increase in the comparative price of vehicles being financed compared to 2017: R300 181 versus R311 574 for July of 2018.

Analyzing the figures

Last year this time the country was mired in pessimism with business confidence at an absolute low.

READ: SA vehicle sales: Here are the top 10 best-selling automakers

After half a year of 'Ramaphobia', has there been an influence on consumer confidence? One way of establishing that is to analyse new car sales for the year to date.

To most accurately track a possible change in market demand between 2017 and 2018, it’s beneficial to select both the most popular passenger vehicle and bakkie in SA, then compare the sales data of each. That means VW Polo Vivo and Toyota Hilux, which each account for most of the volume in their respective segments.

                                                                    Image: Quickpic

Hilux is outright the most popular vehicle in SA and it’s growing range (currently at an amazing 37 derivatives) attests to nearly unwavering demand. Comparing data from the first half of 2017 to this year the numbers are encouraging.

READ: Powerhouse Polo in SA: Volkswagen goes on top in new car sales

In the first six months of 2017, a total of 16 830 Hilux bakkies were delivered to customers. For the corresponding period in 2018, the number was 19 842 – which accounts for a year-on-year increase of 17.8%. Inarguably positive figures.



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What does the data say?

Repeat the same data harvesting period and methodology with VW’s Polo Vivo and it’s a curiously different trend. Last year 14 464 Vivos were sold in the first six months, whilst this year deliveries were slightly down in the matching period: 13 974.

That accounts for a decrease of 3.3%. That said, there have been changes to the Vivo range, with the sedan now discontinued.

                                                                    Image: Wheels24

What does the data tell us?

The simple fact is that bakkies are what sustain the momentum in South Africa’s retail automobile market. With increased volumes in 2018, as opposed to last year, Hilux proves that the economy might be edging into a recovery.

Hilux remains a favourite

The comparative reduction in sales for Vivo shows that entry level buyers are perhaps more strained than anticipated, whilst Hilux buyers, who are purchasing at a much higher price point, have greater credit access and possible asset liquidity. The latter might also be feeling more bullish about the economy.

Whilst Vivo silos a very narrow segment of the market - entry-level hatchbacks - Hilux represents a much broader sample: from fleet buyers purchasing single-cab bakkies for project work, to private double-cab buyers, purchasing an all-round family vehicle.

A year-on-year increase in Hilux sales bodes well for the local market as it represents a much greater customer sample.

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Read more on:    toyota  |  vw  |  lance branquinho  |  south africa  |  hilux  |  car sales  |  polo vivo

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