South Africa’s automotive industry is the country’s largest manufacturing sector, contributing between 6% and 7% of gross domestic product. This contribution takes into account vehicle and component production, as well as vehicle retail, distribution and servicing activities. In addition, the automotive industry has a significant multiplier effect throughout the economy, including in the metals, plastics, leather and textiles industries.

Various opinions exist as to the outlook for the automotive industry in 2012. On the one hand, commentators are expecting continued growth, given that total industry vehicle sales increased by 8.8% year-on-year in January 2012, compared with the same period in 2011. However, there are those who expect that the negative influences on the market will outweigh the positives, placing a dampener on consumer appetites for new vehicles.

This electronic report examines the state of South Africa's automotive sector in the current context of local and global demand.

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