Total sales of new vehicles declined by 4.1% to 46 021 units last month from the 47 984 units sold in September last year.

Of these sales, an estimated 80.7% or 37149 units represented dealer sales, 13.6% sales to the vehicle rental industry, 2.9% sales to industry corporate fleets and 2.8% sales to government.

Sales of new passenger vehicles slumped by 8.4% to 29 669 units last month from the 32 392 units sold in September 2022.

However, new light commercial vehicles, bakkies and minibus sales grew by 4.6% to 13 169 units last month from the 12 588 units sold in the corresponding month in 2022.

Sales of medium commercial vehicles decreased year-on-year by 5.1% to 871 units but heavy truck and bus sales increased by 10.5% to 2 356 units.

Year-to-date new vehicle sales, at 401 315 units, are 2.5% ahead of sales in the same period in 2022.

Absa Vehicle & Asset Finance head of strategy and business analytics, Henry Botha, said the general trends in the sales numbers looked the same as in the past three months, with passenger vehicle sales down and light commercial vehicle sales up.

Botha said sales of extra heavy commercial vehicles were the highlight of the new vehicle market this year so far.

He attributed the strength of the extra heavy commercial vehicle market to an improvement in the available supply of these vehicles after shortages last year because of supply chain problems.

Botha said multiple factors are driving the decline in passenger vehicle sales in recent months and the continued growth in light commercial vehicle sales.

He said interest rates were lower last year than they are now and consumers are more impacted by the higher interest rates, causing a slowdown in passenger vehicle purchases.

Botha added that there were significant light commercial vehicle supply chain problems last year because of the KwaZulu-Natal floods and also change-over by some manufacturers to new product lines, and the improved supply of these vehicles has resulted in sales at normal 2019 sales volumes.

“These two factors could be hiding a bit of what would have been a downturn if there were normal sales [light commercial vehicle] last year,” he said.

Naamsa CEO Mikel Mabasa said although the SA Reserve Bank (SARB) maintained the repurchase rate at 8.25% last month, the automotive industry continues to grapple with concerns over consumer affordability.

Mabasa said the most recent SARB report indicates a 0.3% contraction in household consumption expenditure, with household debt surpassing household disposable income by 62.5% in the second quarter of 2023.

In addition, the new vehicle industry faces potential upward pressures stemming from an elevated inflation outlook, fluctuations in the exchange rate, rising fuel prices and increased energy costs.

However, Mabasa said on the positive side, Statistics South Africa reported in September 2023 that the manufacturing and finance industries were the core drivers of GDP growth in the second quarter of 2023, which was recorded at 0.6%.

“Motor vehicles, parts and accessories, and other transport equipment grew by 9.5%, contributing 1.0% to the GDP.

“This unequivocally demonstrates that, despite the less favourable economic prospects, the outlook for the South African vehicle market in 2023 remains distinctly optimistic,” he said.

View the full results: AVAF Infographic September 2023