Newly published regulations by the Department of Trade, Industry and Competition have allowed the motor industry to immediately open for business, albeit under strict conditions.
“We have carefully crafted new directives which will empower our dealership network across the country to cautiously resume their operations, whilst reducing the risk of infection across the entire automotive value chain and saving the lives of employees and those they come into contact with through the dealershop floor and their maintenance and repair centres,” says Trade, Industry and Competition Minister Ebrahim Patel.
National Association of Automobile Manufacturers of South Africa president Tim Abbott notes that the industry “is pleased” that the Minister has heard “its plea” to return to work.
“We all support the directives as outlined and announced by Minister Patel. The risk of this virus spreading is real and this is something we have embraced and it is part of all our business planning.”
Under the new regulations, vehicle dealers are allowed to sell both new and used cars, while original-equipment manufacturers (vehicle manufacturers) and importers may wholesale new and used cars.
Vehicles may also be imported and exported.
Trade-in purchases, car lease scheme returns and the wholesale trading of used cars are also permitted.
Importantly, for customers planning to go to a dealership – no mask, no entry. Also, no children are allowed in dealerships and visitors will have sign a register upon entry.
Government has taken a three-phased approach for dealerships to return to business.
Under Phase One (starting May 12 and expected to end after two weeks), dealerships and used-car outlets can operate with a maximum of 30% of staff members. The majority of car sales must be done remotely – in other words, via the Internet or telephone.
Home deliveries of fully sanitised vehicles are mandatory.
Under Phase Two (expected to start on May 26 and last for two weeks), dealerships and used-car outlets can operate with up to 60% of staff members and a limited number of customers can enter the dealership under strict hygiene and physical distancing conditions.
During this phase, on-site pick-ups and deliveries of fully sanitised cars will be allowed.
Phase Three starts June 8 and continues until the national Covid-19 Alert Level 4 is lifted.
At this stage, all staff members are allowed to return to work at the dealerships and used car outlets, while customers will be allowed on-site, although this should still be kept to a minimum.
In all three phases, test drives can only be arranged on appointment, while car auctions must be conducted online.
In order to support dealerships, roadworthy assessment and testing centres will open, while the National Regulator for Compulsory Specifications will provide homologation services.
“This directive is undoubtedly good news for motorists and the motor industry alike,” says AutoTrader CEO George Mienie.
“Based on an AutoTrader survey, the financial wellbeing of a whopping 65% of vehicle-buying consumers in South Africa has been negatively impacted by the nationwide lockdown.
“Many – 30% to be precise – are under pressure to replace their vehicle within the next four weeks.
“This is being reflected in a massive increase in online searches. The highest number of car searches during the Alert Level 4 period was recorded on May 10. We recorded over 1.3-million searches on that day alone. In the last two weeks, enquiries to car dealers have risen by an astounding 69%,” notes Mienie.
“It is clear that motorists are desperate for the motor industry to open its doors. Those South Africans under pressure to sell their car or trade down will be celebrating. . . Dealers, on the other hand, are under pressure to survive. Thus, this directive is the best of both worlds."
In order to support dealerships and repairs, auto electricians, tyre fitment centres, windscreen replacement centres, bond stores and parts distribution centres, as well as motor body repairers may also reopen, but they will also have to trade under strict hygiene and physical distancing restrictions.