Bumper year for SA auto industry
South Africa's automotive industry was again one of the best-performing in the world in 2006, with both new vehicle sales and industry production hitting all-time highs, the National Association of Automobile Manufacturers (Naamsa) reported on Tuesday.
Naamsa said in a statement that new vehicle sales for 2006 were up by 15.7% compared to 2005, from 617 406 to 714 340 vehicles sold - South Africa's third successive year of record domestic sales.
The country's automotive industry exported 179 854 vehicles in 2006, a 28.5% increase on the 139 912 vehicles exported in 2005, Naamsa reported - predicting that SA exports would exceed 220 000 units in 2007 on the back of the roll-out of major export programmes.
"South Africa's track record as a manufacturer and supplier of vehicles and automotive components has been firmly established over recent years and the positive export growth momentum ... should continue through 2007 and beyond," Naamsa said.
Naamsa president Johan van Zyl warned, however, that while exports were projected to reach new record levels in 2007, the year would be "more challenging" for new vehicle sales.
Higher interest rates and car prices - driven by increased producer price inflation and steel prices, among other factors - meant that the domestic new car market was "likely to move sideways or register modest growth at best" in 2007, Van Zyl said.
At the same time, Naamsa said, a projected 4.1% GDP growth rate for South Africa in 2007, together with strong business confidence and corporate profitability, should serve to support demand for new motor vehicles during 2006.
"Moreover, car rental business (boosted by higher levels of economic activity and tourism) and government business (driven by increased investment in infrastructure development and basic services delivery) are also likely to remain strong."
At the same time, Naamsa predicted that growth in sales of trucks and light commercial vehicles would outperform car sales growth in 2007, supported by increased infrastructural development and construction activity and growth in domestic fixed investment in the country.
SouthAfrica.info reporter
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