New-vehicle sales in SA started the year weakly with the 41,636 units reflecting a decrease of 3.8% from the 43,294 vehicles sold in January 2023.
It is the sixth consecutive month of declining sales and motor industry body Naamsa attributed it to the lingering effects of cost-of-living increases and dampened consumer and business confidence, combined with the country’s port challenges and persistent load-shedding.
Passenger car sales of 28,790 units dropped 6.7% in January from 30,863 in January 2023, said Naamsa CEO Mikel Mabasa. Sales of light commercials, including bakkies and minibuses, improved 2.3% to 10,871 units.
“It seems the dreaded ‘Januworry’ has taken effect with a further decline in consumer affordability due to the cost of living increases and the political climate uncertainty of an election year. Even the fact that the vehicle rental industry bought 11.5% of the total vehicles sold in January could not prevent another month of decline,” said Brandon Cohen, chair of the National Automobile Dealers’ Association (Nada).
“Even the fact that the vehicle rental industry bought 11.5% of the total vehicles sold in January could not prevent another month of decline.”
Mabasa said a start of an interest rate cutting cycle, likely to begin during the second half of the year but preferably earlier, accompanied by easing core and food inflation and improvements in the country’s energy and logistics infrastructure, could provide relief for consumers and subsequently stir up momentum in the new vehicle market.
“Encouragingly, the Absa purchasing managers’ index (PMI) relating to expected business conditions in six months’ time, despite the economic woes, rose as respondents’ expectations turned more optimistic relative to conditions now,” he said.
“January’s weaker performance continued the trend in declining year-on-year sales the market has experienced since August,” said Lebo Gaoaketse, head of marketing and communication at WesBank. “But this performance should consider more realistic market figures to compare against the previous year than the skewed data since the pandemic years.”
WesBank expects efforts to stimulate demand in the market.
“Banks may increase their risk appetite with lower quoted rates on deals to capture market share,” said Gaoaketse. “Brands and dealers will also be hungry to convert sales, offering enticing incentives that may provide an opportunity for the market to remain buoyant.”
Naamsa is looking forward to the new energy vehicle regulatory framework details to be announced in the 2024 budget on February 21 by the minister of finance, believing it would provide a much needed injection of confidence for the SA automotive industry to accelerate its transition to electric vehicles and associated components production and stimulating demand for the new technology vehicles.
Toyota retained its position as the most popular new vehicle brand in January with 10,855 sales, ahead of Volkswagen (5,522), Suzuki (5,235), Ford (2,420) and Nissan (2,315).
Top 30 selling new vehicles in January 2024:
- Toyota Hilux — 2,645
- VW Polo Vivo — 2,034
- Ford Ranger — 1,914
- Toyota Corolla Cross — 1,660
- Suzuki Swift — 1,566
- Toyota Starlet — 1,479
- Isuzu D-Max — 1,336
- Toyota Hiace — 1,194
- VW Polo — 1,079
- Toyota Fortuner — 974
- Nissan NP200 — 969
- Chery Tiggo 4 Pro — 914
- Nissan Magnite — 843
- Hyundai Grand i10 -766
- Suzuki Ertiga — 657
- Suzuki Baleno — 625
- Toyota Vitz — 622
- Toyota Urban Cruiser — 589
- Mahindra Scorpion Pik-Up — 578
- Haval Jolion — 567
- Kia Sonet — 510
- VW T-Cross — 502
- Renault Kiger — 483
- Suzuki Jimny — 445
- Suzuki S-Presso — 434
- Haval H6 — 421
- Suzuki Fronx — 391
- Renault Triber — 388
- Hyundai i20 — 379
- Toyota Rumion — 372
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