New vehicle prices in South Africa continue to climb well above the inflation rate in a market already severely constrained by the financial effects of the COVID-19 pandemic. However, the South African vehicle export market is forecast to recover in line with the global economy. And while 2020 was more focused on surviving the COVID-19 storm, the South African car industry will shift more towards a refocusing and recovering theme in 2021. This is according to TransUnion South Africa’s latest Vehicle Pricing Index (VPI) for Q4 2020, which was released today, 11 February 2021.
Some of the report’s findings are:
- Vehicle prices rose above the inflation rate for the third successive quarter in Q4 2020.
- This has created greater demand for used vehicles and could herald further car price increases in 2021.
- There is a significant increase in VPI when comparing both new and used vehicles in Q4 2019 and Q4 2020
- The VPI for new vehicles rose sharply to 9.6% in Q4 2020 from 2.9% in Q4 2019.
- The used vehicle VPI rose to 2.9% from 1.2% over the same period.
- New vehicle finance deals went down by 14.8% while used vehicles went down by 6.2% event though the used-to-new vehicle ratio in Q4 2020 remained largely consistent, at 2.31.
- The percentage of cars (new and used) being financed below R200 000, R200 000 to R300 000 and over R300 000 saw a clear movement out of the below R200 000 bracket towards vehicles in the R200 000-R300 000 bracket.
- Consumer confidence continues to remain low.
View:
South African Car Market Faces Challenging 2021 Amidst Ongoing Uncertainty
Also view:
Vehicle Finance, Car Insurance and Road Safety
Buying and Selling a Vehicle – Informed decisions and the Vehicle Retailer
The Online Vehicle Retail Market and Safely Selling Vehicles Online
Buying a Quality Used Car and Safety on the Road