Reflecting on the new vehicle sales statistics for the month of September 2019
The National Association of Automobile Manufacturers of South Africa [NAAMSA] said that the slide in the performance of the overall new vehicle market continued into September 2019 but that the volume passenger car segment reflected an unexpected but welcome uptick, largely supported by strong sales to the car rental industry during the month.
Reflecting on the new vehicle sales statistics for the month of September 2019 released today for public consumption via the website of the Department of Trade and Industry, NAAMSA confirmed that aggregate domestic new vehicle sales, at 49 191 units, reflected a decline of 439 units or 0,9 % from the 49 630 vehicles sold in September last year. Monthly export sales had registered a modest decline compared to the high base level of the corresponding month last year, but the upward momentum remains strong.
Overall, out of the total reported industry sales of 49 191 vehicles, an estimated 37 707 units or 76,7% represented dealer sales, an estimated 18,9% represented sales to the vehicle rental industry, 3,1% to industry corporate fleets, and 1,3% to government.
The September 2019 new passenger car market reflected a welcome surprise on the upside and, although only modest, increased by 358 cars or 1,1% to 33 139 units compared to the 32 781 new cars sold in September last year. The car rental industry continued to support domestic volumes, accounting for a substantial 27,3%, or more than one out of every four new cars sold, in September 2019.
Domestic sales of new light commercial vehicles, bakkies and mini buses at 13 473 units during September 2019 had recorded a decline of 894 units or a fall of 6,2% from the 14 367 light commercial vehicles sold during the corresponding month last year.
Sales in the medium and heavy truck segments of the industry reflected a mixed performance and at 790 units and 1 789 units, respectively, reflected an increase of 97 vehicles or an improvement of 14,0%, in the case of medium commercial vehicles, and, in the case of heavy trucks and buses, at 1 789 units, the exact same number of vehicles were sold during the corresponding month last year.
The September 2019 export sales number at 35 657 vehicles reflected a decline of 1 097 units, or 3,0%, compared to the high base of 36 754 vehicles exported in the same month last year. For the first nine months of the year, vehicle exports, at 297 065 units, are now 47 050 vehicles or 18,8% higher than the corresponding period last year and well on track to achieve another record in 2019.
Consumers and businesses will continue to delay purchasing decisions on big items such as new vehicles until there is greater economic stability all around and they are more optimistic about their economic future. Although the economy grew in the second quarter of the year off the first quarter’s very low base, the underlying pace of activity remains weak. The second consecutive large fall in the ABSA Purchasing Managers’ Index (PMI), from 45,7 index points in August 2019 to 41,6 index points in September 2019, reiterated the weak underlying demand conditions.
The ABSA PMI index tracking business conditions in six months’ time also declined, expecting the environment to worsen further going forward. Vehicle sales speak volumes and as a good leading indicator of the economic climate in the country is mirroring the ongoing low business and consumer confidence levels at present.
Although vehicle exports declined during the month compared to the corresponding month of last year, exports remain the main driver of vehicle production activity in the domestic market. The vehicle export momentum remains upward with the industry on track to achieve a new record in 2019.