CAPE TOWN – South African vehicle manufacturers are likely to switch their focus to the export market as a weak domestic economy curbs demand well into the new year, according to Standard Bank.
This comes after new vehicle sales fell 8.4 percent across all categories to 47 486 units in November 2018, compared to 51 856 units the previous month, according to data released by the National Association of Automobile Manufacturers of South Africa (Naamsa).
This decline represented a 4.6 percent drop from the 49 751 new vehicles sold in November last year.
“The weakness that we see is largely on the demand side of the market and is something that is expected to continue into the first quarter of 2019,” said Mr Cyril Zhungu, head of dealer automotive retail at Standard Bank. “The result is that there is likely to be a shift in the supply strategies of vehicle manufacturers from the local market to the export market although there is still some uncertainty over the impact of Brexit on the European Union which remains the most important export destination for South African manufacturers.”
It is further noted that manufacturers continue to play an active role in supporting sales through sales support schemes and minimising upward price movements as evidenced from the low vehicle price inflation, which remains favourable for the consumers.