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New vehicle sales in June 2015 – NAAMSA comment on the local market

New vehicle sales in June 2015

The recent trend with domestic new vehicle sales continued during the past month, with the exception of light commercial vehicle sales.

Domestic sales of new light commercial vehicles, bakkies and mini-buses during June stood at 14 756 units. This reflected a modest improvement of 223 units or a gain of 1,5% compared to the 14 533 light commercial vehicles sold during the corresponding month last year.

Sales of vehicles in the investment-driven medium and heavy truck segments of the Industry had also registered declines. Medium commercial vehicle sales at 804 units and heavy commercial vehicle sales at 1 656 units, reflected a fall of 103 units or 11,4% in the case of medium commercials and a decline of 322 vehicles or a fall of 16,3% in the case of heavy trucks and buses – compared to the corresponding month last year.

Industry new vehicle exports overall (all cars and commercial vehicles) at 31 422 units during June, 2015.

Vehicle exports (cars and commercial vehicles) reflected upward momentum and continued increasingly to contribute positively to South Africa’s current account of the balance of payments. Industry new vehicle exports overall (cars and commercial vehicles) at 31 422 units during June, 2015 had again registered impressive growth compared to the corresponding month last year rising by 7 930 vehicles or 33,8% relative to the 23 492 export sales in June, 2014. Vehicle exports for 2015 remained on target to improve, in annual terms, by about 25% to a projected industry record export number of about 330 000 for the year.

The underlying trends in new car sales, as well as commercial vehicle sales, had reflected a steady decline in recent months and were expected to remain under pressure over the short to medium term. Subdued levels of economic activity, electricity supply constraints, the impact of the recent higher personal tax burden, substantial increases in petrol price inflation and above-inflation new vehicle price increases – all contributed to an unfavourable outlook for domestic new vehicle sales. Business confidence and consumer sentiment, as a result, were also under pressure. The slight gain in the Purchasing Managers Index on the back of an improvement in business activity and an improvement in expected business conditions represented positive news.

In contrast to the difficult domestic environment, the continued sharply higher new vehicle export sales would continue to support the industry’s vehicle production levels and South Africa’s balance of payments.

[Abridged version by Annelise van der Laan]

Source: NAAMSA OFFICES: PRETORIA 1st July, 2015


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