Total new vehicle sales (as reported by NAAMSA today) recorded positive growth in August of 11.1%y/y. Year-to-date domestic sales remained 14.5% ahead of the corresponding eight month period in 2010. New passenger car sales improved by 8.0% compared to August 2010. New car sales were assisted by one additional sales day compared to the corresponding month last year.
The latest growth figures, while respectable, confirm that passenger car sales have lost momentum in the past few months. The August growth rate represents the lowest monthly improvement in the past nineteen months. August 2011 new car sales again received strong support from car rental companies with the car rental industry accounting for 20% of total car sales.
South Africans love their bakkies and sales of new light commercial vehicles, bakkies and minibuses exceeded expectations, reflecting a gain of 19.8% compared to the corresponding month last year. The sale of medium and heavy trucks reflected an increase of 24.6%y/y and 13.5% respectively.
August 2011 export sales were recorded at 24 835 vehicles, an improvement of 5230 units or 26.7% compared to the strike-affected total of 19 605 in August last year.
Recent low numbers in the purchasing managers' index suggest a slower pace of expansion over the medium-term. Modest growth in private sector credit extension and in money supply, sharply higher administered price increases, including electricity and fuel costs, will put the consumer’s disposable income under considerable pressure and as a result, new vehicle sales over the balance of 2011 are expected to show growth at a lower rate.
Expectations of slower global growth, particularly in developed economies, might also affect industry export sales over the medium term.
Laura Jones
Economic Assistant
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