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| Fresn from the UK and just in time for South Africa's summer is Paul Sansom, new boss at Audi. |
WHILE South Africans are still buying fewer new vehicles, used car
sales continue to rise and a cyclical upturn awaits.
Absa banks points out most of the year-to-date decline in new car
sales can be ascribed to the impact of the Mercedes Benz C-Class line being set
up for production, the discontinuation of an export model by a major
manufacturer and the industrial action.
Head of vehicle and asset finance at Absa, Wessel Steffens, said in
a statement the bank expects cars sales to improve in last quarter as the
C-Class production is resumed and Numsa’s strike is over for this year.
“News of a decline is never great, however July’s 1,5% decline is a
welcome relief after other months this year where we’ve seen declines as high as
10,2%” said Rudolf Mahoney, head of research at WesBank. “However, the growth
this month [July] has been at fleet level, and not through dealer sales. This is
indicative that consumers are still under pressure, with higher fuel prices and
another hike in the interest rate.”
The percentage of applicants requesting balloon payments remained
stable in July.
This decline in the new market can be attributed to continued
growth in the used car market, where buyers are finding better value for money.
WesBank’s own data comparing sales of used and new vehicles shows a
ratio of 1,39 used vehicles to every one new vehicle, a year-to-date increase of
11%.
Despite less activity in dealerships, July saw an all-time record
for vehicle finance applications, at 129 000. with the new car sellers reporting
a 5% year-on-year increase in the number of people hoping to get a car loan, and
the used vehicle sellers reporting yet another month of double-digit growth for
pre-owned vehicles, at 15%, year-on-year.
Looking into the future at an event in Port Elizabeth to recognise
its best performing suppliers, MD of Volkswagen Group South Africa, David Powels
reminded that sales in the automotive industry was cyclical. “The automotive
industry is in cyclical downturn which normally brings lower profits and
returns. As companies, we are not immune to that. It is however important that
as partners we maintain a positive attitude towards each other as our success
will be determined by the extent of our collective agreement and compromise on
key issues. We all share similar interest which is the long term success of our
companies.”
The new boss at Audi South Africa, Paul Sansom will succeed Ryan Searle, who has been appointed as
Managing Director of Audi Taiwan.
