New-vehicle sales “slumped dramatically” in July, serving as a reflection of the “current difficult economic conditions” in the country, says National Association of Automobile Manufacturers of South Africa (Naamsa).
Statistics released by the Department of Trade and Industry show that sales declined 17%, compared with the same month last year.
New-car sales showed the biggest drop, shrinking by 20.6% in July, to 29 007 units.
July sales of new bakkies, minibuses and vans, at 13 575 units, declined by 9.9%, while sales of medium trucks, at 722 units, dropped by 13.9%.
New heavy truck and bus sales declined at a smaller margin – 5.7% – to 1 579 units.
Export sales of new vehicles delivered the only good news for the month, increasing by 2.4% to 29 042 units.
Naamsa says the rest of 2016 will, most likely, continue to be characterised by low economic growth and increased pressure on consumers’ disposable income. Double-digit new-vehicle price increases, rising retrenchments and fragile consumer and business confidence are expected to put further pressure on new-vehicle sales.
Standard Bank vehicle and asset finance head Nicholas Nkosi has a marginally more upbeat take on the situation.
“Passenger vehicle sales continue to show strain, with the highest year-to-date decline,” he says. But, he adds: “The strain will continue for the duration of the year; we do not anticipate it to continue at current levels.”
He adds that the average passenger-car deal size increased from R295 976 in July 2015 to R296 500 in July 2016.
“We are still seeing a shift towards used vehicles. This trend is not likely to change in the short to medium term.”