Toyota SA’s production woes left an unmistakable mark on both export and domestic sales of new vehicles in May.
The company’s Prospecton vehicle assembly plant in Durban suspended production in April after KwaZulu-Natal’s catastrophic floods submerged parts of the plant. Some limited activity has resumed but this has not yet extended to high-volume vehicles, such as the Hilux bakkie, HiAce taxi, and Quest and Corolla cars.
Sales and marketing head Leon Theron said on Wednesday that a date for resumption of operations had yet to be determined. However, he said recently that with diminishing stocks of pre-flood vehicles available, local customers would enjoy priority over exports.
The Hilux shortage, in particular, contributed to a 29.9% fall in SA vehicle exports in May. In March, before the floods, the company exported 6,837 vehicles, mainly Hiluxes. In April, this number was down to 3,629. In May, it was 143.
The result was an industry total of 25,788 exports — 29.9% down on the 36,798 of May 2021. The biggest drop, 58.9%, was in light commercial vehicles, which include Hilux. After five months of 2022, aggregate exports were 6.2% behind last year at 143,348.
Floods were not the only cause of May’s export shortfall. Naamsa CEO Mikel Mabasa also blamed a general drop in demand from export markets hurt by “rising interest rates, supply chain disruptions, resurgent Covid-19 waves [and] producer and consumer inflation at the highest levels in decades”.
Figures released on Wednesday by Naamsa showed that domestic new-vehicle sales improved in May, though by the slowest rate this year. The 38,358 was 2.1% better than a year ago.
Car sales grew 13.8% to 27,437. Sales of medium and heavy trucks also improved but in the light commercial vehicle sector sales fell 22.6% to 9,221.
Toyota retained market leadership in May by importing more vehicles to take up some slack — though its 6,664 sales were well short of April’s 8,952.
At the end of May, the aggregate 2022 new-vehicle market stood at 212,537, which was 12.2% ahead of last year.
Cyril Zhungu, Standard Bank’s head of automotive retail finance, said full-year market growth was likely to remain around this level. Faster growth in previous months was always going to be hard to sustain, particularly in the face of flooding, rising interest rates, inflation, a depreciating rand, record fuel prices and events in Europe and Asia, which had limited vehicle stocks.
Mabasa said: “Although the economy will need to adjust to this new reality, long-term solutions are required in an already unbearable inflationary environment.”
Alex Boavida, vice-chair of the National Automobile Dealers Association, said that despite “being hit from all angles”, SA consumers retained their appetite for new cars. More, though, are buying models that are cheaper to buy and run.
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