Further SATAWU industrial action impacts on distribution networks
02 December 2013: Stock supply issues in the wake of the recent industrial action continued to affect local sales last month, according to the latest figures released by the National Association of Automobile Manufacturers of South Africa (NAAMSA).
Rudolf Mahoney, Head of Research at WesBank, South Africa’s leading asset-based financial solutions provider, says the data shows that local sales of new vehicles declined year on year by 4.8%, from 53 265 units in November 2012 to 50 806 units in November 2013.
Compared with the same period last year, passenger vehicle sales declined significantly by 5.9%, from 36 431 to 34 267. Light Commercial vehicle sales declined by 4.3% from 14 329 to 13 719.
Mahoney says, “Medium, heavy and extra heavy commercial vehicles, as well as buses, bucked the trend and performed well, confirming that the heavier commercial vehicles are currently in a replacement cycle, which is driving the growth in sales in these segments.
“The decline in the overall market is attributed to stock supply issues, and this has now been further exacerbated by the South African Transport and Allied Workers Union strike. The manufacturers had just brought their assembly lines back into production when the new strike began, thereby adversely affecting the distribution networks.”
Mahoney reports further that consumer demand, as measured by the number of applications received, remains very strong with a 1% growth in applications when compared to November 2012. Demand continues to grow off an already high base, confirming that the decline in the market can mainly be attributed to stock constraints.
“The recent decision by the South African Reserve Bank to leave interest rates unchanged undoubtedly provides a level of confidence to those consumers who are considering credit purchases. However, growing household debt levels remain a concern, especially going into the festive season when credit purchases, especially unsecured debt, traditionally have a seasonal spike.
“WesBank’s view is that stock supply constraints will most likely affect the December sales as well, and that the full year sales numbers will be softer than the industry predicted earlier in the year”, he concludes.
With over 40 years of experience WesBank has become the leader in asset-based finance solutions in South Africa. The company is focused on providing quality asset finance and fleet management solutions for a number of market sectors. WesBank’s asset finance portfolio includes Aviation, Agriculture, Commercial and Company Vehicles, Plant and Office Equipment, Public Sector and Franchise finance solutions. Visit www.wesbank.co.za for more information.