Business confidence is improving - NADA

Brandon Cohen, the recently appointed National Chairperson of NADA, says the fact that total vehicle sales are still showing growth is good news for the local motor industry and the economy in general “but what makes this performance in July special is that strong demand in most segments of the commercial vehicle market is the reason for the growth”.

“This indicates growing confidence in the economy by the business world, as most commercial vehicles are bought by businesses,” he says.

Cohen says sales of light commercial vehicles (LCVs) grew year-on-year by 32.6% last month to 12 666 units, and although medium commercial sales were down 11.6%, the 31.6% increase in heavy truck and bus sales compared to July 2022 more than made up for this decrease.

Year-to-date total sales of 309 359 units represent growth of 4.4% compared to sales registered for the first seven months of last year. However, Cohen says sales through the retail dealer channel, which accounted for 81.8% of the total volume, “was rather disappointing”.

But Cohen says the vehicle rental industry seems to be building confidence in the future and accounted for 14.1% of the total sales volume in July 2023.

“Admittedly, there is a buy down trend with many consumers opting for smaller and less expensive models, which are also less of a drain on the monthly household budget.

“Other factors contributing to the positive sales performance are better stock availability and Original Equipment Manufacturers’ (OEMs), distributors’ and importers’ support for trade-ins and new vehicle incentives.

“What is concerning is that there are lots of activity on digital platforms and websites, but this is not translating into sales in the passenger space.

“This is likely owing to the financial constraints consumers are facing.

“But all in all, the sales figures for July were better than expected, thanks to the commercial and LCV buyers in the market, along with the car rental industry,” he says.