Despite the looming threat of tariffs, SA’s domestic new-vehicle market continued full throttle in July, which delivered the highest monthly sales since October 2019.
In the 10th straight month of increased volumes, 51,383 units were delivered last month, up 15.6% from July 2024, which industry body Naamsa attributed to improving consumer confidence, favourable credit conditions and a steady recovery in disposable incomes.
It firmly re-established pre-Covid levels and momentum in the market’s recovery.
Passenger cars were the best-performing segment last month at 36,248 units, the highest since January 2017 and a gain of 20.1% from July 2024. Car rental sales accounted for 14% of last month’s figure.
Sales of new light commercial vehicles, bakkies and minibuses at 12,356 units last month were 6.9% higher than in July 2024.
Medium trucks sold 703 units (plus 13.9%) while sales of heavy trucks and buses dropped 1.3% to 2,076 units.
The decision by the Reserve Bank in July to reduce the repo rate by 25 basis points to 7% — its third cut this year — will inject much-needed stimulus into the economy, said Naamsa CEO Mikel Mabasa.
“Encouragingly, household credit extension has continued to improve, while consumer sentiment is rebounding — especially among middle- and upper-income groups,” Mabasa said.
“The implementation of pension reforms has also unlocked additional liquidity for big-ticket purchases such as vehicles. This positive trend is further reinforced by improved logistics performance, a more stable electricity supply, and a sustained demand for high-spec, cost-effective vehicles across market segments,” he said.
Year-to-date sales of 330,274 new vehicles this year were 13.9% up on the first seven months of 2024.
“There remains a direct correlation between the rate-cutting cycle and the upturn in new-vehicle sales,” said Lebo Gaoaketse, head of marketing and communication at WesBank.
“The market should continue to expect growth if interest rates remain lower,” Gaoaketse said.
“The cumulative interest rate cut of 1.25% since the cycle started is saving a typical new car buyer around R257 per month. The sweet spot of the new vehicle market is a price point of R370,000 according to WesBank’s book.
“More critically, the interest saving over the loan period could be more than R18,500, which shows the impact lower rates have on stimulating the market and aiding affordability.”
Vehicle exports have shown resilience in the face of the 25% automotive tariffs imposed by the US in April. Export volumes last month decreased 1.9% to 35,379 units compared with July 2024, but year-to-date exports were still 2.5% ahead of the same period in 2024.
However, the 30% tariffs imposed on SA from this month are expected to cause economic headwinds for some local motor manufacturers.
“Despite global uncertainty and the looming threat of tariffs, SA’s vehicle market continues to show remarkable resilience,” said Brandon Cohen, chair of the National Automobile Dealers’ Association.
A contributor to the robust passenger market is the growing influence of Chinese and Asian vehicle brands, he said.
Four Chinese importers are now among the top 15 best-sellers, including newer entrants such as Omoda/Jaecoo and Jetour.
“Financial institutions have also shown confidence in these brands by offering white-labelled finance packages, further supporting their market penetration,” Cohen said.
“Meanwhile, manufacturers like Kia and Mahindra continue to feature prominently in the top 10, reflecting strong demand for affordable, value-driven options, a trend that has also underpinned Suzuki’s consistent success.
“The rapid rise of Chinese and Asian brands reflects a shift in buyer preferences towards affordability and value.
“It’s a trend we expect to intensify as more brands enter the market,” he said.
Toyota retained its lead as SA’s most popular brand in July. The top 15 selling brands were:
1. Toyota — 12,694
2. Suzuki — 6,257
3. Volkswagen group — 5,738
4. Hyundai — 3,161
5. Ford — 2,877
6. GWM — 2,436
7. Isuzu — 2,427
8. Chery — 2,160
9. Kia — 1,891
10. Mahindra — 1,441
11. Renault — 1,320
12. BMW group — 1,249
13. Nissan — 1,190
14. Omoda and Jaecoo- 1,069
15. Jetour — 717
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