NAAMSA MEDIA RELEASE :COMMENT ON THE APRIL 2017 NEW VEHICLE SALES STATISTICS
NAAMSA MEDIA RELEASE: FOR IMMEDIATE RELEASE
COMMENT ON THE APRIL, 2017 INDUSTRY NEW VEHICLE SALES STATISTICS
Commenting on the new vehicle sales statistics for the month of April, 2017 – released today for public consumption on the website of the Department of Trade & Industry – the Association said that new vehicle sales in all segments, with the exception of medium commercial vehicles, had deteriorated sharply during the month registering double digit declines. In large part, the lower sales could be attributed to the proliferation and configuration of public holidays during the month. In 2017, the Easter holidays fell during the month of April, whilst in 2016 they fell during the month of March. The multiplicity of public holidays had also impacted on new vehicle exports which also reflected a sharp year on year decline.
In the event, April 2017 aggregate new vehicle sales at 34 956 units had decreased by 5 392 units or 13.4% from the 40 348 vehicles sold in April last year. April, 2017 export sales at 24 449 had registered a sharp fall of 8 383 vehicles or a decline of 25.5% compared to the 32 832 vehicles exported in April last year.
Overall, out of the total reported Industry sales of 34 956 vehicles, an estimated 31 479 units or 90.1% represented dealer sales, 4.3% represented sales to the vehicle rental Industry, 3.1% to Industry corporate fleets and 2.5% to government.
The April, 2017 new car market at 22 452 units reflected a fall of 3 560 cars or a decline of 13.7% compared to the 26 012 new cars sold in April last year. The car rental Industry had accounted for an estimated 5.2% of new car sales in April, 2017, however, the rental industry’s share was probably understated since it excluded estimates of BMW SA and Mercedes car rental sales.
Domestic sales of industry new light commercial vehicles, bakkies and mini buses at 10 592 units during April, 2017 reflected a decline of 1 625 units or a fall of 13.3% compared to the 12 217 light commercial vehicles sold during the corresponding month last year.
Sales of vehicles in the medium and heavy truck segments of the Industry had also recorded falls and at 562 units and 1 350 units, respectively, reflected a decline of 22 units or 3.8% in the case of medium commercial vehicles and, in the case of heavy trucks and buses, a decline of 185 vehicles or a fall of 12.1% compared to the corresponding month last year.
Industry new vehicle exports had been lower than expectations and at 24 449 units exported during April, 2017 reflected a reduction of 8 383 units or a decline of 25.5% compared to the 32 832 vehicles exported in April last year.
Following the modest improvement in new vehicle sales experienced during the first three months of 2017, the outlook for the balance of the year had turned negative on the back of the extra-ordinary political events at the end of March, 2017 and early April, 2017. Political and social polarisation in South Africa, together with prospects of lower domestic growth over the short to medium term – continued to weigh on business confidence and consumer sentiment. Domestic new vehicle sales were closely correlated with the overall performance of South Africa’s economy and confidence levels. The key performance factors driving new vehicle demand included Gross Domestic Product growth, the direction of interest rates and the exchange rate. The International Monetary Fund (IMF) and a number of South African banks had revised downwards 2017 prospects for South Africa’s growth. The slump in the latest Purchasing Managers’ Index reinforced expectations of a more difficult economic environment characterised by a lower growth rate. NAAMSA anticipated that greater clarity would be forthcoming over the next two to three months regarding the impact of socio-political events on the direction of the economy and this would enable then the Association to resume projections on new vehicle sales. At this stage, the risk for new vehicle sales was on the downside.
Industry new vehicle exports would remain a function of the performance and direction of global markets. Indications for the global economy were reasonably positive with the latest IMF projections anticipating global growth at around 3.6%. This would benefit vehicle exports to Europe, Australasia, Asia, the United States and South America. NAAMSA anticipated that export sales would register upward momentum over the balance of 2017 thereby continuing to contribute positively to South Africa’s trade balance.
NAAMSA OFFICES: PRETORIA
Tuesday, 2nd April 2017