The South African economy, including the automotive industry, was hit by the perfect storm last month, says National Automobile Dealers’ Association (NADA) chairperson Mark Dommisse.

“This is not limited to July and will, in all likelihood, have an ongoing negative effect for several months to come. 

“Dealers faced stock shortages while local manufacturers battled to keep production going due to disruptions in the component supply chain caused by global semi-conductor shortages and the cyberattack on the port operating systems, disruptions in KwaZulu-Natal and parts of Gauteng, as well as the reimposition of level 4 lockdown.

“However, the sales figures are certainly not as bad as we had feared, with the aggregate total sales in July of 32 949 units being slightly better – 1.7% up – on the situation a year ago,” notes Dommisse.

Dealers also performed well again, being responsible for an estimated 86% of sales, with rental companies taking an encouraging 9.2%, while 2.7% of sales went to industry corporate fleets and 2.1% to government. 

“On a year-to-date basis our total sales after seven months of 2021 stand at 260 466 units, which is 33.7% higher than at the same time last year, which is heartening,” notes Dommisse.

Asset finance group WesBank agrees that South Africa’s new-vehicle sales recovery momentum was dealt a harsh blow in July.

“July brought the fragility of the motor industry back into stark focus,” says WesBank marketing and communication head Lebogang Gaoaketse.

“Not only did the month bring physical impacts, but the resulting consequences in business and consumer confidence will continue to challenge the industry’s recovery for months to come. Once again, the industry’s resilience is being put to the test.”

WesBank remains optimistic, however, on the industry’s continued recovery. 

“Rejuvenation of rental fleets, progress in the country’s vaccination rollout programme and revitalisation of the economy in general will all contribute towards building the South African motor industry,” says Gaoaketse. 

“The industry needs to remain focused on delivery and the inevitable demand that will rise in the medium term.

“While the country encountered yet another speed bump during July, there are many reasons to believe in the continued recovery of the market,” he adds.

“Low interest rates, the return of adjusted Level 3 lockdown regulations, and some improvement to civil stability will provide a good basis for the industry’s determination to once again shine through.”