SA vehicle sales plunged by 68 percent versus May last year
Johannesburg - Following April’s hard lockdown that all but obliterated local car sales, the South African motor industry slowly chugged back to life in May, with dealers and manufacturers reopening in a phased approach.
However, given the current economic turmoil and the fact that dealers only opened their doors on May 13, it was always going to be a slow sales month. A total of 27 496 new vehicles were sold in South Africa in May, which is a 68 percent decline versus the same month last year.
Similarly, export sales fell by 64 percent, although Naamsa notes that this was to be expected given that many of South Africa’s vehicle manufacturers only resumed operations at the beginning of June.
Light commercial vehicles took the biggest hit on the local sales charts last month, with a year-on-year decline of 74.8 percent, while passenger cars registered a decline of 65.4 percent versus May last year.
However, as is usually the case, South Africa’s top selling vehicle was a bakkie, with Toyota’s Hilux registering 796 sales. It was followed by the Volkswagen Polo (668) and Polo Vivo (636), while SA’s second most popular bakkie in May was the Isuzu D-Max, which managed to oust the Ford Ranger, with 611 sales versus 538.
As expected, entry level cars were big business in May, with the Hyundai i10 emerging as South Africa’s third most popular passenger vehicle, with 421 sales, while Suzuki’s S-Presso, which is now SA’s cheapest car, came fifth with an encouraging 283 sales.
“New vehicle sales for May 2020 continue to reflect persistent demand weakness due to the impact of the Covid-19 pandemic as consumer and business sentiment remain severely depressed,” Naamsa commented.
“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 growth in the country therefore does not bode well for the industry over the medium term”.
On the upside, the association said it expects vehicle exports to gain momentum as manufacturers gear up for full production in June, while major export destinations begin to ease their lockdown restrictions.
There has also been a move towards used vehicles on the local market, as WesBank’s marketing head Lebogang Gaoaketse notes:
“WesBank data indicates an increase in demand for used cars in terms of vehicle applications, supported by a larger than usual increase in the deal size of those used car finance agreements.
“This supports some forecast analysis of a trend for consumers to buy down into the used car market in order to reduce the size of their car repayments and mobility budgets”.