New vehicle sales show slow recovery

Mark Dommisse, charirperson of National Automobile Dealers’ Association’s (NADA)

However, according to the National Automobile Dealers’ Association’s (NADA’s) chairperson, Mark Dommisse, “most worrying to note is that July was a very long trading month, and vehicle sales were still almost 30% down on the previous year.

“July was a very difficult trading month and we don’t see a quick recovery from this new reality any time soon. In fact, we’re looking at a minimum of one to two years before we see any significant improvement in new vehicle sales.

“Consumers are still under massive pressure to meet their monthly household expenses, and cautious when making big-ticket vehicle purchases and committing to large financial payments,” says Dommisse.

“While there is some reprieve from recent interest rate cuts, rising fuel prices and general inflation will continue to pinch wallets into the foreseeable future.

“On the positive side, many consumers will have resumed paying deferred instalments in July, and considering the pressure they are under and that there is still an appetite for new cars in the current environment, a flat month from June to July was very encouraging,” adds Dommisse.

In July, passenger car sales were slightly down on the previous month (-125 units) with Light Commercial Vehicle (LCV) sales showing growth of 1 392 units when compared to June 2020.

Out of the total reported industry sales of 32 396 vehicles in July, an estimated 30 325 units or 93,6% represented dealer sales - clearly demonstrating the importance of South Africa’s dealer network contribution to the economy.

Sales from commercial, government and rental sectors appear to still be largely in lockdown as fleet buyers watch budgets closely.