The management of WeBuyCars is bullish about the company’s growth prospects, with all hands on deck as the group enhances its buying strategy, expands its physical footprint and bulks up its online presence.
The company, which dominates the second-hand car market, is advancing its strategy to sell and buy 23,000 units a month by the 2028 financial year and has positioned itself to integrate popular Chinese brands in its network.
WeBuyCars, which has Toyota, Ford and Volkswagen as its top selling brands, has taken note of the rise in popularity of Chinese brands in SA. It said over the past 18 months, SA consumers have embraced the expanding range of Chinese vehicles available in the local market.
“These brands offer a diverse range of makes and models at competitive price points, making them compelling alternatives to traditional household brands,” the annual report reads.
It said the latest Chinese entrant in the domestic market, Jetour, launched in September 2024, with 40 showrooms nationwide, and that Chinese manufacturers had 10% of the new vehicle market share in September.
“Notable brands include Haval, Chery and BAIC, which have gained traction among cost-conscious consumers,” WeBuyCars said in its 2024 annual report, published on Wednesday.
“Chinese vehicles are expected to make up a growing share of the used vehicle market in years to come. WeBuyCars, with its brand-agnostic approach, is well positioned to integrate these vehicles into its inventory management and sales strategy.”
Standard Bank last year said Chinese car brands were defying market challenges in SA, having registered sales growth consistently since 2022 with Haval emerging as the most popular brand, followed by Chery and BAIC.
WeBuyCars said it had increased its focus on the accuracy of vehicle evaluations and the company’s ability to build greater trust in its proprietary data which will serve us well in making smarter, better-informed inventory pricing decisions going forward.
“We remain committed to sustainable growth and market leadership in the Southern African used vehicle market. Our focus is on enhancing data analytics for smarter pricing decisions while pursuing opportunities to grow our physical presence in strategic locations,” the company said.
“On the back of the WeBuyCars agile business model, supported by quick inventory turns and a robust technology platform, management decided about 18 months ago to realign the vehicle buying and capital allocation to the R150,000 to R300,000 price bracket, to align with consumer demand.”
CEO Faan van der Walt in his inaugural letter to shareholders, published in the group’s maiden annual report, said the group’s financial performance reflected its focus on operational excellence and cost discipline.
“We remain committed to sustainable growth and market leadership in the Southern African used vehicle market. Our focus is on enhancing data analytics for smarter pricing decisions while pursuing opportunities to grow our physical presence in strategic locations,” he said.
“We aim to become a leader in the digital automotive space, recognising the growing importance of our website and digital platforms as primary touchpoints for our customers.
“With trusted online resources becoming an essential guide for purchasing decisions, we are focused on building a robust, user-friendly and informative online presence.”
The company, which listed on the JSE on the JSE in April last year, breaking away from parent company Transaction Capital, has been well received on the bourse by investors.
The group’s share price is up 65% over the past six months, attracting blue-chip investors Coronation and the Public Investment Corporation. Coronation has said there were no signs to indicate WeBuyCars’ market share growth was stalling.
The asset manager thinks that the competitive advantage period for WeBuyCars will be longer than what is being priced in as it is the leader in its industry with no sizeable peers.
The group’s 2024 results show a company on an upward trajectory. In November it reported revenue of R23.3bn in the year to end-September, with the last three months of the period seeing the group sell more than 14,000 cars a month.
Chair Johan Holtzhausen in his letter to shareholders acknowledged the warm market reception the company received after its listing on the local bourse, crediting this to the group’s cash generating capabilities — which led to 23.4% growth in profit for the year ended September.
“The positive growth alluded to above also contributed to the WeBuyCars share price growth of 129.6% from its listing price of R18.75 a share on April 11 2024 to December 31 2024, as well as paying a dividend of 25c a share for this period,” Holtzhausen said.
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