South Africa’s new vehicle sales in January 2021 stood at 34,784 units, down by 13.9pc from 40,413 units in January 2020 and by 6.6pc as compared to 37,250 units in the prior month, according to the National Association of Automobile Manufacturers of South Africa (Naamsa).
The association said that the gradual monthly recovery in the domestic new vehicle sales volumes continued in January and the decline during the month was in line with industry expectations.
In January, new passenger car sales stood at 23,853 units, down by 18pc from the previous year, while LCV sales fell by 4.9pc to 9,301 units as compared to the preceding year.
Sales for medium and heavy truck sales in January remained unchanged at 497 units, while heavy trucks and buses grew by 6.6pc to 1,133 units as compared to the same month in the prior year.
Of overall new vehicle sales in January, 82.6pc (28,716 units) represented dealer sales, while the vehicle rental industry sales and sales to the government represented 11.4pc and 3.5pc, respectively. Industry corporate fleet sales represented 2.5pc of the total sales in January.
|South Africa’s new vehicle sales in January 2021 (in units)|
|Type||Jan-21||Jan-20||YoY (pc)||Dec-20||MoM (pc)|
|Light commercial vehicles (LCV)||9,301||9,780||-4.9%||10,784||-13.8%|
In January 2021, the country’s vehicle exports grew by 39.7pc to 22,771 units from 16,303 units exported in the same month year prior and by 27pc as compared to 17,943 units in December 2020, recording a solid growth for the second consecutive month.
The current upward momentum in vehicle exports bodes well for a much-improved performance this year compared to 2020, the association noted.
Naamsa is expecting the new vehicle market in South Africa to remain in the challenging condition in the first quarter of 2021 as compared to the prior-year period due to slow demand, exchange rate volatility, and the negative impact on household expenditure by
fuel and electricity price increases.
However, the association added that considering the close correlation between new-vehicle sales and the country’s GDP growth rate, the Reserve Bank’s forecast of a domestic economic growth rate of 3.6pc for 2021 presents a favorable scenario for a sound rebound in 2021 from the 2020 figures which was the lowest sales in 18 years.
The macroeconomic effects of COVID-19 are expected to continue to undermine business and consumer confidence and inhibit growth over the medium term. Although the current low-interest rates, coupled with low inflation could be regarded as building blocks to stimulate the new vehicle market, full recovery to pre-COVID-19 new vehicle sales could take around three years, the association informed.
It further informed that vehicle export have been regaining momentum but in terms of recovery much will depend on an improvement in the economic climate of the South African automotive industry’s main trading partners.
In January, Naamsa has projected auto sales in South Africa to grow by 15pc in 2021 as compared to the total sales volume in
2020. The automotive industry contributes 6.4pc to South Africa’s total GDP.