New vehicle sales improved for the third consecutive month in July after the relaxing of the Coronavirus enforced regulations, but remained in the red compared to the corresponding time last year. According to the National Association of Automobile Manufacturers of South Africa (NAAMSA), overall sales dropped by 29.6% from 46 042 to 32 396 units but when stacked up against June, improved by a scant 0.9%.
Unlike last month though, all of the various segment were down with new passenger vehicle sales falling by 35.8% from 29 457 to 18 905 and light commercial vehicles by 19.7% from 13 859 to 11 123. The downturn continued in the sales medium and heavy duty commercial vehicles with the former dropping by 12.9% to settle at 698 units, while the latter declined by 13.3% for a total of 13.3%. Exports also registered a downturn of 29.6% from last year’s 35 087 to 24 706, but improved dramatically on those of June where the slump stood at 38.7%.
“Considering the most recent projected negative annualised GDP growth in the country of 7,3% by the South African Reserve Bank, it does not bode well for the outlook on domestic demand for new vehicles over the short term. Positive dynamics such as the further 25 basis point interest rate cut to a near 50-year low during the month and the already 300 basis points interest rate cut for the year, low inflation as well as dealer incentives would be expected to support consumers and businesses into new vehicle purchases,” NAAMSA said.
“However, a recovery in the new vehicle market will most likely depend on how quickly the economy can break out of its low growth trap and how soon society will recover from the present COVID-19 lockdown”.
As before, no individual model sales were released but in terms of manufactures, Toyota posted sales of 7 464 units followed by Volkswagen (5 075), Ford (3 194), Hyundai (2 520), Nissan (2 132), Isuzu (1 671), Mercedes-Benz (1 671), Renault (1 333), Suzuki (1 213) and Kia (905).