Following a slump in new-vehicle sales in recent months, September surprised by delivering an 11.5% increase in sales, compared with the same month last year.

Data released by the Department of Trade and Industry shows that September new-vehicle sales improved to 60 854 units, up from 54 571 units in 2013, with the rental industry responsible for much of the positive news, buying 17.3% of all new vehicles sold in South Africa last month.

September export sales, at 30 778 new vehicles, jumped 258%, compared with the 8 598 units exported in September last year, when the automotive industry experienced a nationwide strike.

New-passenger-car sales, at 42 918 units, reflected a welcome improvement of 2 997 vehicles, or 7.5%, compared with the 39 921 new cars sold in September last year, says the National Association of Automobile Manufacturers of South Africa (Naamsa) in a statement.

“It was the first time in 2014 that new-pas-senger-car sales had registered year-on-year growth, and the improvement could be attributed to a combination of factors, including attractive incentive packages, pre-emptive buying in anticipation of further vehicle price increases on the back of a weakening rand, relatively strong corporate purchases, replacement demand and a strong contribution by the car-rental sector.”

Sales of new light commercial vehicles, bakkies and minibuses, at 15 179 units, jumped 24.7%, compared with September last year.

Sales of medium trucks, at 904 units, improved 1%, while sales of heavy trucks and buses, at 1 853 units, increased by 16.9%.

The strength in heavy truck sales is encour-aging and suggests improved investment senti-ment, notes Naamsa.

“This significant growth [seen in September] is unexpected, but definitely welcome,” adds WesBank head of research Rudolf Mahoney. “While light commercial vehicles have sold incredibly well, the passenger-car market has held its own, with sales being driven by demand for newly introduced models.”

Data from WesBank shows that activity in the vehicle market was at an all-time high in September, with a record number of finance applications, at 130 484, a year-on-year increase of 21%.

Of this increase, new-vehicle applications grew by 7% year-on-year, while used-vehicle applications increased 29% over the same period.

While the increase in domestic new vehicle and export sales was good news, Naamsa advises caution in the outlook for the balance of the year.

“Lower economic growth, recent increases in interest rates, the possibility of a further interest rate hike before year-end, and above-inflation new-vehicle price [increases] will ensure that the new-vehicle trading environment remains difficult.”

The domestic market is expected to register a decline, in volume terms, of between 4% and 5% in 2014, compared with 2013.

However, against the background of normal-ised industry vehicle production, further improve- ment in export numbers is anticipated.