New cars, exports drive vehicle sales
4 August 2010
South African new vehicle sales put in a mixed performance in July, with buoyant car sales and soaring exports – albeit off a low base – negated by a slowdown in sales of commercial vehicles and trucks.
Aggregate new vehicle sales improved by 20% to 41 367 in July, the National Association of Automobile Manufacturers of SA (Naamsa) said, with car sales registering credible gains but light commercial vehicle sales showing signs of weakness.
"On balance, the latest aggregate sales numbers confirmed expectations of a moderation in the underlying growth momentum in the various sectors," Naamsa said on Tuesday.
Aggregate sales registered increased by 6 895 vehicles or 20% to 41 367 vehicles, compared to the 34 472 motor vehicles during the same month in 2009.
According to Naamsa, the year on year monthly improvement was below the 23.3% growth for the first seven months of 2010 implying, as expected, slower growth.
Nedbank economist Johannes Khosa said that vehicle sales were likely to remain firm for the rest of the year: "Vehicle sales are likely to remain firm during the remainder of this year, supported mainly by continued improvement in passenger car sales and export demand."
Commercial vehicle sales down
In contrast to the relatively buoyant new car sales, the sales of new light commercial vehicles, bakkies and minibuses declined by 310 units, or 2.9%, to 10 375 in July, compared to 10 685 units of the corresponding month last year.
Medium and heavy truck segments sales in July also showed a mixed picture at 616 and 1 155 units respectively. Medium commercial vehicles recorded an increase of 58 units, while there was a slight decline of 12 units in the case of heavy trucks and buses in comparison to the same month last year.
"The growth momentum in the medium and heavy commercial vehicle segments had also slowed significantly," Naamsa said.
Strong gains for exports
Export sales made strong gains in July 2010 in relation to a very low base figure of the same month in 2009 when exports were badly affected as a result of the global financial meltdown.
In July, export sales of South African produced vehicles at 23 246 vehicles registered a gain of 12 038 units or an improvement of 107.4% compared to the 11 208 vehicles exported during July last year when export sales had been extremely depressed as a result of the global financial crisis.
Year to date new vehicle exports at 130 025 units have reflected an improvement of 38 361 vehicles exported or 41.8% compared to the 91 664 export sales during the corresponding seven months of 2009.
Of the total Naamsa industry sales of 35 555 vehicles, 84.7% represented dealer/retail sales while 8.5% represented sales to the car rental industry, 3.7% represented industry corporate fleet sales and 3.1% sales to government.
"Aggregate industry new car sales during July 2010 had been at the upper end of expectations, and at 29 221 reflected an improvement of 7 159 units or 32.4% compared to the 22 062 new cars sold by the industry during July 2009. The selling rate of new cars per day remained relatively robust."
Carbon emissions tax
Naamsa aniticpated new vehicle sales to moderate over the remaining months of the year, with aggregate domestic sales for 2010 projected to expand by about 15% while export sales were projected to grow by about 30%.
"Factors that would influence domestic sales volumes during the remaining months of the year included the overall performance of the domestic economy, the inflationary consequences of the impending CO2 new car tax regime and the outcome of the current round of collective bargaining in the various sectors of the industry,” said Naamsa.
Earlier this year, Finance Minister Pravin Gordhan said that as of 1 September, environmental taxes on new cars in South Africa would be enforced in order to influence consumer behaviour in favour of more fuel efficient vehicles that emit less carbon.
Source: BuaNews
