http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.69Change: -0.02
R/$ = 10.96Change: 0.00
Au 1195.22 $/ozChange: -3.23
Pt 1225.00 $/ozChange: -4.50
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
May 05, 2009

New vehicle sales slumped 43% in April

Back
Ford CEO Hal Feder speaks on the company's April results Cameraperson: Nicholas Boyd Editing: Darlene Creamer
Africa|Aggregate|AMH Group|Ford|Nedbank|Rental|Africa|South Africa|Aggregate New Car Sales|Automotive|Car Rental Industry|Car Sales|Dealer/retail Sales|Manufacturing|Services|Jacques Brent|Naamsa|Power|Operations
Africa|Aggregate|Rental|Africa||Automotive|Manufacturing|Services|Power|Operations
africa-company|aggregate|amh-group|ford|nedbank|rental|africa|south-africa|aggregate-new-car-sales|automotive|car-rental-industry|car-sales|dealerretail-sales|manufacturing|services|jacques-brent|naamsa|power|operations
© Reuse this



The National Association of Automobile Manufacturers of South Africa (Naamsa) on Tuesday reported that sales in all segments of the South African new vehicle market, as well as export sales, had continued to register sharp declines, compared with the corresponding month last year.

In aggregate terms, April recorded a year-on-year decline of 43,7% in new vehicle sales, which was the worst on record.

In addition to a slowing economy and depressed consumer spending, the main factor contributing to the massive decline was April’s large number of public holidays, Naamsa reported.

The organisation reported new vehicle sales for April at around 24 063 units, which reflected a massive decline of 18 262 units, or 43,1% compared with the 42 325 units sold during the April 2008. Factoring in aggregate vehicle sales reported by the AMH Group, the year-on-year decline amounted to 43,7%.

Overall, of the total Naamsa reported industry sales of 24 063 vehicles, 83,1% or 20 001 units represented dealer/retail sales, 4,4% sales to government, 7,5% represented sales to the car rental industry, and 5% into industry’s corporate fleets.

New car sales for April were recorded at 15 071 units, which reflected a decline of 9 033 units or 37,5% compared with the 24 104 new cars sold during April 2008. Factoring in aggregate new car sales reported by the AMH Group, the year-on-year decline had amounted to 10 615 units or a fall of 38,8%.

This constituted the largest year-on-year monthly decline in new car sales over the past 24 years.

Naamsa reported that sales of new light commercial vehicles (LCV), bakkies, and minibuses were recorded at around 7 481 units during this period, reflecting a substantial decline of 7 364 units or 49,6% compared with the 14 845 units of the corresponding month last year. Taking account of the LCV sales reported by the AMH Group, the year-on-year decline amounted to 7 880 units or 49,5%.

Sales of vehicles in the medium and heavy truck segments of the industry had registered substantial falls during April, with sales at 691 units and 820 units respectively, which was a massive decline of 586 units or 45,9%, in the case of medium commercials, and 1 279 units or 60,9%, in the case of heavy trucks and buses. This was compared with the corresponding month last year.

Naamsa reported that the continuing weakness in medium and heavy commercial vehicle (HCV) sales confirmed a downturn in investment spending by the private sector and reflected that business confidence was under pressure. The lower sales in the sector also reflected continuing difficulty experienced by truck operating businesses in obtaining finance.

With one-third of calendar 2009 accounted for, aggregate industry new vehicle sales recorded at 128 164 units, reflected a decline of 36,4% compared with the 201 473 vehicles sold during the corresponding four months last year.

Automotive producer Ford on Tuesday stated that dealer sales for April had fallen to 20 000 units for the month, which was akin to levels last seen in December 2002.

Speaking at a function hosted by Naamsa, Ford sales and marketing vice president, Jacques Brent stated that only 12 000 passenger and 6 500 LCV had been sold during the month.

Year-on-year, Ford sales have declined by 35,5% in January, with February recording a 36% decline, March a 30% decline, and April a 29% decline in vehicle sales.

HCV were under a lot of pressure and April sales were down 60,7%, which Brent said was caused mostly by the number of holidays during the month, but also because of the downscaling in commercial operations.

EXPORTS DROP

Naamsa stated that the decline in exports of South African-produced motor vehicles had accelerated during April 2009, and at 11 479 vehicles had registered a decline of 11 057 vehicles or 49,1% compared with the 22 536 vehicles exported during April 2008.

The slowdown in South Africa’s major export markets was expected to translate into further declines in the number of vehicles exported by the industry during calendar 2009. 


All sectors in the South African automotive value chain continued to experience extremely difficult operating conditions with an increasing number of businesses, particularly in the auto parts manufacturing and retail sectors, fighting for survival, Naamsa said.

The most recent 1% reduction in interest rates and the resultant lower debt servicing costs would bring some relief to hard-pressed consumers and businesses, while domestic sales of new vehicles were expected to remain under pressure in the short-to mediu- term.

However, a revival in consumer expenditure on the back of lower interest rates, together with stimulatory government spending, should start to lend support to the domestic market during the second half of the year.

“Any improvement in industry new vehicle exports would only materialise once the severe current global financial and economic crisis abated and confidence returned to international markets. More recently, positive signs had emerged in the form of a return of some confidence in international financial markets,” Naamsa said.
Financial services provider Nedbank stated that vehicle sales were expected to remain weak in the months ahead, as economic conditions continued to deteriorate both locally and globally.

Domestically, rising unemployment, weak income growth as well as high household debt should continue to weigh heavily on consumer confidence and purchasing power.

“Some recovery in passenger vehicle sales is likely to be experienced during the second half of the year as previous interest rate cuts start to take effect, while commercial vehicle sales could remain weak in line with the slowdown in fixed investment activity and the overall economy. The export market will be volatile during the year and will be driven by the developments in major export destinations,” Nedbank reported in a statement.

Absa expected vehicle sales for the year to drop by between 24% and 25%, believing that the market would likely bottom out during the middle of the year, as well as regain some ground towards the end of the calendar period.

Edited by: Mariaan Webb
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Automotive News
 
Latest News
Updated 7 hours ago South Africa’s National Treasury on Friday reissued its amended request for proposal (RFP) for the five-year multibillion-rand project to replace the legacy systems currently in use with an enterprise resource planning (ERP) solution for an integrated financial...
Systems Automation and Management Durban manager Weyers van der Merwe, Richards Bay dry bulk terminal manager Mandla Mpungose and Umfolozi TVET college principal Sam Zungu.
Updated 7 hours ago The handover of specialised computer equipment to the Umfolozi Technical and Vocational Education and Training College would address one of the greatest challenges faced by Transnet Port Terminals (TPT) at the Port of Richards Bay – a lack of skills in a highly...
Through hosting the WorldSkills 2014 competition’s mechatronic pre-national finals, industrial control and automation company Festo would promote and support skills development. Festo said the mechatronic competition would give schoolchildren, trainees and students...
More
 
 
Recent Research Reports
Defence 2014: A review of South Africa's defence industry (PDF Report)
Creamer Media’s Defence 2014 report examines South Africa’s defence industry, with particular focus on the key participants in the sector, the innovations that have come out of the sector, local and export demand, South Africa’s controversial multibillion-rand...
Road and Rail 2014: A review of South Africa's road and rail infrastructure (PDF report)
Creamer Media’s Road and Rail 2014 report examines South Africa’s road and rail transport system, with particular focus on the size and state of the country’s road and rail network, the funding and maintenance of these respective networks, and the push to move road...
Real Economy Year Book 2014 (PDF Report)
This edition drills down into the performance and outlook for a variety of sectors, including automotive, construction, electricity, transport, steel, water, coal, gold, iron-ore and platinum.
Real Economy Insight: Automotive 2014 (PDF Report)
This four-page brief covers key developments in the automotive industry over the past 12 months, including an overview of South Africa’s automotive market, trade figures, production and the policies influencing the sector.
Real Economy Insight: Construction 2014 (PDF Report)
This five-page brief covers key developments in the construction industry over the past 12 months. It provides an overview of the sector and includes details of employment in the sector, infrastructure and municipal spending, as well as insight into companies’...
Real Economy Insight: Electricity 2014 (PDF Report)
This five-page brief covers key developments in the electricity industry over the past 12 months, including details of State-owned power utility Eskom’s generation activities, funding and tariffs, independent power producers and prospects for the sector.
 
 
 
 
 
This Week's Magazine
As the City of Ekurhuleni continues its bid to develop the largely industrialised metropole into the continent’s first aerotropolis, executive mayor Mondli Gungubele has committed the city to creating a predictable, stable and enabling business environment in which...
While Ford Motor Company of Southern Africa (FMCSA) did not have “significant issues” with power supply in Gauteng, it was a different story in the Eastern Cape, said FMCSA and American Chamber of Commerce in South Africa president Jeff Nemeth earlier this month....
In 2000, exports into Africa from South Africa represented less than 5% of the turnover of Federal Mogul Motorparts Africa, with sales largely centred around Zimbabwe, Zambia, Malawi and Mozambique. Today, African exports represent 30% of sales, with trade expanded...
The Malawi government has launched a $50-million project to upgrade the Kamuzu barrage, on the Shire river, an outlet of Lake Malawi, which is used to control the flow of water from the lake to the lower Shire area. The project will run from this year to 2017 and...
  Our new Technical and Vocational Education and Training (TVET) Colleges will replace the Further Education and Training (FET) Colleges which have served us for the past twenty years.  The buildings will be the same and most of the staff will be the same but as the...
 
 
In a move likely to hearten Gauteng commuters who spend rush hour stuck behind big trucks, Transport Minister Dipuo Peters on Friday said her department was looking at restricting heavy vehicles during these times. "The department is considering some form of...
South Africa’s Finance Minister Nhlanhla Nene
South Africa’s Finance Minister Nhlanhla Nene has emphasised the role of the private sector in delivering the 51 Programme for Infrastructure Development in Africa (Pida) projects, collectively valued at $68-billion, being prioritised for implementation by 2020....
Gauteng Premier David Makhura
Gauteng premier David Makhura will receive a report from the e-toll review advisory panel on November 30, the provincial government said on Thursday. The media was invited to attend the hand over which would take place in Parktown, Johannesburg, spokesman Mohlalefi...
More
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks