2017 ended on a positive note for the automobile industry as it saw an increase in the demand for new cars. This according to the annual sales data from the National Association of Automobile Manufacturers of South Africa (Naamsa).
These results come irrespective of December 2017’s year-on-year sales declining 2.4%, the year-to-date new car sales for 2017 grew 1.8%.
A staggering total of 557,586 new vehicles were sold in South Africa last year.
Rudolf Mahoney, head of brand and communications at WesBank says “The new vehicle market’s positive performance for the last year was almost exactly in line with our forecast of 1.74% growth,”.
“This can be attributed to the rand being resilient in the face of volatility and the South African economy performing better than anticipated. However, the economy is still underperforming and faces a long road to recovery” he says.
In the second half of 2017, original equipment manufacturers (OEMs) were able to prevent price increases as the rand firmed against foreign currencies. This therefore allowed manufacturers to give consumers good deals through attractive marketing incentives when purchasing new vehicles.
Data released by WesBank for 2017 also shows the continued shift back to the new vehicle market, especially when measuring demand through the number of vehicle finance applications received. Demand for new vehicles rose 6.4% in December, while demand for used vehicles was at 0.2%.
Overall, demand for new vehicles grew 3% in 2017, while demand for used vehicles declined 1.5%.
The demand for new vehicles comes as consumers are seeking reliable as well as fuel-efficient technologies.