Johannesburg - With South Africa’s new-vehicle market continuing its flat spin on the back of an ever-weakening Rand, more and more motorists are turning to second-hand cars.
The Rand’s depreciation has pushed interest rates and inflation way past the comfort zones of many new-car buyers, and last month’s total industry sales of 42 907 units showed a decline of 10.3 percent compared to May last year. Year on year sales are the lowest they’ve been in five years.
But, while days are dark in the new-vehicle market, demand for used cars has made a sharp upward curve. Motor financier WesBank says the second-hand car market, measured by application volumes, grew by 9.5 percent in May alone.
“In the current market consumers will find themselves either having to hold onto their cars for longer, before replacing them with a new model, or taking their budget to the used market,” said WesBank Motor Retail CEO, Simphiwe Nghona. “This focus on affordability highlights the pressure on consumer budgets. The cost of motoring is on the rise, and will start playing a bigger role going forward.”
Online classifieds company OLX confirms the trend, and says that businesses are also feeling the pinch.
“We are seeing a lot more trucks and other commercial vehicles being listed, which means businesses are too moving away from buying new and rather looking for second-hand bargains,’’ says OLX’s Karla Levick.
“One of the key driving factors for the rapid growth of second-hand vehicles sales on online classifieds is the fact that buyers don’t have to pay heavy dealership commissions. They trade directly with one another and therefore avoid such extra costs.’’
According to recent data released by OLX, the most popular car brand on its website is Volkswagen, with Toyota close behind in second place.
In terms of models, the VW Golf tops the list followed by the Polo, Toyota Corolla and then the BMW 3 Series.
Star Motoring