CAPE TOWN - Auto Trader South Africa, an online market where consumers do more than 35 million vehicle searches a month, wants physical vehicle dealerships to open during level 4 of the lockdown, which starts on Friday.
Automotive manufacturers won't be able to operate without vehicle retail causing a build-up of supply. Capital investment by manufacturers would result in new vehicles ending up in parking lots waiting for retailers to open, the online platform argued yesterday in a statement.
Evidence using Auto Trader’s search data suggested that the automotive retail sector would be one of the biggest stimuli to the South African economy, should dealerships be opened.
Demand for vehicles by buyers, as defined by search activity and enquiries to retailers on Auto Trader, reduced to its lowest on the day of lockdown, the online platform said. Since lockdown, car and commercial vehicle demand had materially recovered, although not fully, which indicated that consumers were ready and active now to buy vehicles.
After President Cyril Ramaphosa’s address last week, Auto Trader saw the biggest recovery in consumer demand since lockdown, with search demand for vehicles on Sunday hitting its highest level since February 17, the highest level of demand that Auto Trader had seen for any weekend this year, the statement said.
This past weekend was also 31percent higher than the weekend ending March 29 after lockdown started. Motor vehicle operations were not ready to fully complete transactions online yet, which was another reason that showrooms needed to be opened. The majority of jobs in the auto industry were in retail, and already potentially up to 10percent of the workforce was going to be laid off due to the weak economy prior to the lockdown, so opening dealerships would protect employment.
Auto Trader was experiencing increased demand for vehicles under R200000, which showed appetite for consumers to downgrade their vehicles, and potentially free up cash flow.