New vehicle sales dip 68% in May- better than April
CAPE TOWN - New vehicle sales in May of 12 932 fell by 68 percent or 27 496 units compared with the number sold in May last year, the National Association of Automobile Manufacturers of South Africa (Naamsa) said on Tuesday.
However, it was a noteworthy improvement from April when most of the industry, from manufacturers to motor dealers, were all closed by the government due to the Covod-19 pandemic, and only a few hundred vehicles were sold.
Similarly, although May’s export sales at 10 819 units represented a big 64.1 percent fall compared to the 30 152 vehicles exported in May last year, this was an improvement on April, considering that many of the vehicle manufacturers only started production this month.
Overall, out of the total reported industry sales vehicles, an estimated 11 289 units, or 87.3 percent, represented dealer sales, 7.9 percent sales to government, 2.9 percent to industry corporate fleets, and an estimated 1.9 percent represented sales to the vehicle rental industry.
May’s new car market fell 65.4 percent or by 17 083 units to 9 019 units over May last year.
Domestic sales of new light commercial vehicles, bakkies and mini-buses at 3 073 units during May recorded a big decline of 9 128 units or a fall of 74.8 percent, from the 12 201 light commercial vehicles sold during the corresponding month last year.
The medium and heavy truck segments fell by 55.5 percent, and by 62.8 percent, respectively, in May, compared with the same month last year.
Vehicle exports were expected to regain momentum with the vehicle assemblers resuming operations and with the easing of lockdown restrictions also in other countries.
The association said new vehicle sales for May reflected persistent demand weakness due to the impact of the Covid-19 pandemic, as consumer and business sentiment remain severely depressed.
“The motor industry is currently experiencing unchartered conditions given the current unpredictability in these uncertain times. New vehicle sales are generally linked to the strength of the economy and the anticipated extent of the negative annualised GDP (gross domestic product) growth in the country therefore does not bode well for the industry over the medium term,” said Naamsa chief executive Michael Mabasa.
He said that under normal market circumstances positive indicators such as sharp petrol price decreases, substantial interest rate drops, below-inflation vehicle price increases, dealer incentives and low inflation would support the new vehicle market.
However, “how far these dynamics will move consumers and businesses into new vehicle purchases over the balance of the year remains unclear,” he said.
“As an industry, we will maintain and strengthen all our health and safety measures across the entire value chain as we ramp up our operations to 100 percent of employment under Alert Level 3,” he said.