In December 2008, South Africa’s auto and banking industries sold 32 765 vehicles with the one hand, while repossessing about 
7 000 vehicles with the other.

In relation to December’s figures, this number 
means roughly two in ten vehicles sold each month find their way back into the already saturated market, as consumers struggle to meet the payment strain.

The good news is that “repossessions are stabilising, and are expected to start declining during 2009”, says McCarthy Motor Holdings chairperson Brand Pretorius.

However, while vehicle retailer McCarthy is hurting in the current market conditions, its vehicle auction arm, Burchmore’s – selling about 30% of South Africa’s repossessed 
vehicles – has managed to capitalise on 
recent market trends.

While car dealerships are generally faced with the bleak reality of a global economic slump, Burchmore’s is thriving.

Last year, when new vehicle sales dropped by 2,8% in April (compared with figures for April 2007), Burchmore’s posted triple-
digit retail sales growth of 127%.

This was followed by month after month of record sales, in 
defiance of slumping new and used car sales.

Now it again seems that the same bargain-hunting trend will be evident this year.

The company saw a 40% increase in registered auction buyers in the first two weeks of 2009, compared with figures for the corresponding period last year.

Burchmore’s divides its sales into two categories: auctions and off-the-floor sales.

The latter are especially buoyant,says MD Darryl Jacobson, with 200 retail sales in the Sandton branch alone in the first two weeks of 2009.

To put this into perspective, some dealers do not sell 200 used cars over a 
period of six months.

Jacobson says motorists are turning to Burchmore’s because the company sells at wholesale prices.

“We all know that South Africans are tightening their belts – and that’s why they are coming here.

Public transport in South Africa is limited, so South Africans still need cars.

“They have not stopped buying; they are just spending their money more carefully.”

Finance and operations director André Dalais says Burchmore’s will continue to focus on affordability and choice.

“We know this is a successful recipe. The most concrete testament . . . to this concept was the success of our two sales last year.

“In Johannesburg, 2 600 people flocked to the sale and over 500 vehicles were sold, many of them snapped up by dealers because of the wholesale prices.

“In Durban, 2 500 people attended the sale, and 460 of the 500 used cars on the floor were sold.

“This means we sold 92% of our stock in a single weekend, which is quite astounding.”

Jacobson says this proves that there is no dip in demand for used vehicles.

“Yes, rising household bills are beginning to affect consumer confidence, but South African motorists are still buying as many used vehicles as in the past,” he says.

Looking ahead, the Burchmore’s team remains optimistic, with stock being the only limiting factor.

“Burchmore’s is looking for stock. We’re selling everything we’ve got,” says Jacobson.