Used-car market rises while new-car sales decline

19th February 2016

  

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Sales data released by South African automotive industry information provider the National Association of Automobile Manufacturers of South Africa (Naamsa) has noted that, while new-vehicle sales have declined by 6.9% since January 2015, data from vehicle finance and insurance provider Wesbank has shown that 70% of all finance applications received for January 2016 were for used vehicles.

Wesbank motor division CEO Simphiwe Nghona expects a continued shift to the used market throughout this year, as cash-strapped and budget-conscious consumers attempt to address affordability.

“The decline in new-vehicle sales comes as no surprise in the current economic climate, with consumer and business confidence at very low levels, as a result of a number of macroeconomic factors,” he states.

Wesbank recognises that all segments experienced a gradual decline, with passenger car sales only totalling 34 936, a year-on-year decline of 6.1%. Light commercial vehicle sales declined by 8.3% during the same period, with sales of 12 074 vehicles noted.


Vehicle sales through the dealer channel declined by 12.6% year-on-year, while government sales were down 27.4% for the same reporting period. In contrast, sales to the rental market saw a massive growth of 49.6% last month.

“The spike in rental sales is an anomaly, but is most likely due to rental companies choosing to reflect ahead of new-car price increases. Despite this positive activity in the rental market, total industry sales still saw a decline,” concludes Nghona.

Edited by Zandile Mavuso
Creamer Media Senior Deputy Editor: Features

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