February’s total new vehicle sales saw a negligible year-on-year decline of 0.1%, with sales of 48 113 units. According to the latest aggregated sales data from the National Association of Automobile Manufacturers of South Africa (Naamsa) sales growth was seen in a number of segments, including light commercial vehicles (9.7%), medium commercial vehicles (8.5%) and heavy commercial vehicles (27%).
Despite growth in the commercial segments, total passenger car sales fell 4.4%, year-on-year. Passenger car sales through the dealer channel slumped 5% – a shortfall that could not be counteracted by growth of 26% for passenger cars through the rental channel. Total sales through the rental channel grew 32.5%, year-on-year. Sales through the government channel also contributed to this month’s result – with buying activity in light- medium- and heavy commercial vehicle segments contributing to growth of 33%
“The growth in the rental channel and commercial vehicle segments is indicative of these businesses entering their replacement cycles, acquiring new assets to refresh their fleets,” said Rudolf Mahoney, Head of Brand and Communications at WesBank. “Passenger car sales are still struggling, though. Household budgets remain under pressure and consumers are choosing to hold onto their cars for longer.”
WesBank’s internal data reflects the trends seen in the consumer space. February saw demand for new vehicles drop 8.4%, year-on-year. Demand for used vehicles also slowed, with 5.3% fewer applications received compared to February last year. Consumers who did finance vehicles also paid more: the average deal value for a new car was 8.8% higher, while the average car was 9% more expensive year-on-year.
“This is the first decline in demand we’ve seen for used vehicles and we will need more data to see if this is a trend for the year. A number of factors influence this and we will be sure to watch it closely,” said Mahoney. “However, consumer demand for used vehicles continues to outpace new vehicles by a factor of 2.4:1”
— Arrive Alive (@_ArriveAlive) March 1, 2017