The positive turnaround in South Africa’s new vehicle sales continued in September, according to the latest aggregate sales data from the National Automobile Association of South Africa. A total of 50 322 new vehicles were sold across all segments, last month, representing year-on-year sales growth of 6.3%.
Data indicates that consumer buying patterns were responsible for the positive performance, over the past month. The dealer channel, where consumers are active, saw overall growth of 6.3%. Within the dealer channel, passenger car sales volumes grew 10.3% while sales of light commercial vehicles (LCVs) rose 5.3%.
“This remarkable recovery in the new vehicle market is being made possible by superlative marketing incentives from manufacturers,” said Rudolf Mahoney, Head of Brand and Communication, Wesbank. “Right now, new vehicle deals are just that much more attractive than buying used, and consumers are seeing the value.”
WesBank’s data points to value for money as the sales driver behind September’s sales performance. Average deal values for new vehicles are in decline. While new vehicle price inflation has slowed, the vehicles prices have not declined. Compared to the previous month, September’s average new vehicle finance transaction value was 1.1% lower: a clear indication that manufacturers are giving so much back to the consumer to the extent that the average transaction value has come down.
Conversely, the supply of quality used vehicles is drying up, which has resulted in continued price inflation. Used vehicle finance deal values have risen 8.4%, year-on-year, and show no real signs of slowing down – climbing 2.5% in just the last three months.
“When looking at the macroeconomic indicators over the past few months, we see some stability. However, it’s not all plain sailing for car buyers and motorists,” said Mahoney. “The cost of mobility is rising sharply, in keeping with the recent months’ rapidly escalating fuel prices, and contributing to a negative outlook for the remainder of the year. It, once again, shows that consumers should leave breathing room in their budgets to accommodate increases over the duration of their finance contract.”