Deloitte’s 2021 Global Automotive Consumer Study has found that the Covid-19 pandemic has had a major impact on consumer behaviour in the automotive industry.
The study surveyed more than 24 000 consumers in 23 countries, including South Africa.
Deloitte says the goal of the yearly study is to answer questions that can help companies prioritise and better position their business strategies and investments.
This year, the report made four key findings related to the South African market.
The first is that Covid-19 has forced consumers to reconsider their vehicle choices and purchasing plans.
“As a likely result of the adverse economic environment due to the ongoing Covid-19 pandemic, 40% of [South African respondents] stated that they are considering delaying the purchase of their next vehicle,” says the report.
“However, only 16% of consumers consider purchasing a cheaper, more fuel-efficient or smaller vehicle due to the impact of the pandemic.”
While young consumers tend to regard vehicle ownership as less important than older consumers, pandemic-induced social distancing is an important factor pushing younger consumers to think about vehicle ownership, adds the report.
The second finding is that consumers are seeking affordability and convenience when choosing a vehicle finance provider.
While a quarter of South African consumers said that they did not research vehicle-financing options, 45% spent more than three hours researching finance options prior to acquiring their current vehicle.
More than half of consumers stated that receiving the lowest possible financing rate was the key factor when choosing a vehicle finance provider.
“In addition to consideration related to affordability, South African consumers look for a provider that offers convenience, an easy process and flexibility,” states the 2021 Global Automotive Consumer Study.
“These key factors suggest that South African consumers are price-conscious and many feel the economic impact of the Covid-19 pandemic.”
A third finding of the report is that dealerships remain the preferred purchasing channel among South African consumers.
“Close to three-quarters stated that they intend to purchase their next vehicle in person at a dealership.
“Most consumers said they wanted to see and/or test-drive a vehicle prior to purchasing it.”
Close to half the consumers who are open to purchasing their next vehicle through a virtual process, stated convenience as the key driver for them in using a virtual channel, found the report.
A fourth significant finding is that cost and a lack of enabling infrastructure remain key barriers to electric vehicle (EV) adoption.
“Interest in vehicles with alternative powertrains has dropped in South Africa compared to last year’s survey,” states the report.
“Higher prices relative to vehicles with internal combustion engines and the lack of enabling infrastructure remain key barriers to EV adoptions in the country.
“The majority of consumers (61%) that consider an EV as their next vehicle would only be willing to pay up to R500 000 for such a vehicle.”