This distortion is caused by the hard COVID-19 lockdown in April 2020 when only 574 new vehicles were sold was responsible for the dramatic but meaningless 6 133.3% improvement in new vehicle sales in April 2021.

Sales figures released on Monday revealed that 35 779 new vehicles were sold in April 2021 compared to April 2020 when vehicle production and retail sales came to a standstill owing to the hard COVID-19 lockdown restrictions.

Total new vehicle sales in April 2021 were 17.6% lower than the 43 428 vehicles sold in March 2021.

However, Mikel Mabasa, the CEO of automotive council Naamsa, attributed this month-on-month decline to the impact of the configuration of public holidays and the resultant fewer selling days during April 2021 compared to the previous month.

Mabasa highlighted that new vehicle sales for the first four months of 2021 were now 28.3% higher than in the corresponding period last year.

He added that although the new vehicle market in 2021 is expected to rebound substantially compared to 2020, it is important to note that aggregate new vehicle sales in 2020 dropped back to the level of 18 years ago and a recovery to pre-COVID-19 sales levels will take at least three years.

The distortion in the year-on-year sales comparisons has resulted in Naamsa using month-on-month comparisons of the sales statistics.

Sales of new passenger cars declined by 13.9% to 22 911 vehicles in April 2021 from the 26 599 new cars sold in March 2021, with the car rental industry accounting for 10.1% of all car sales in April 2021.

Sales of new light commercial vehicles, bakkies and mini-buses dropped month-on-month in April 2021 by 24.3% to 10 879 units, medium commercial vehicles by 24.2% to 511 units and heavy trucks and buses by 17.5% to 1 478 units.

Mabasa said that dealer sales accounted for an estimated 88.0% or 31 482 units of total reported industry sales of 35 779 vehicles in April 2021.

Sales to the vehicle rental industry accounted for an estimated 7.5% of total sales, government sales 2.4% and sales to industry corporate fleets 2.1%.

Mabasa said renewed activity in the rental market, interest rates remaining at low levels, the easing of the lockdown restrictions and the fact that all five subcomponents of the ABSA Purchasing Managers’ Index (PMI) are in positive terrain for the first time since early 2012 will support business and consumer sentiment and subsequently the new-vehicle market in 2021.

However, Mabasa said COVID-19-induced manufacturing supply chain disruptions, such as the current global shortage of semi-conductors, also known as computer chips, are an important part of modern vehicles and could impact on the availability of specific models during the year.

Lebogang Gaoaketse, head of marketing and communication at WesBank Vehicle and Asset Finance, said April 2021 sales are difficult to interpret within the context of lockdown.

“On balance, April sales lost less against March than March sales had gained against February, meaning the market remains in its state of slow recovery,” he said.

New vehicle sales in March 2021 increased month-on-month by 18.4% compared to February 2021.

“While WesBank continues to finance more than twice the number of pre-owned vehicles than new ones, there is a marginal shift towards new-car sales.

“Affordability remains a key purchase consideration, driving consumers towards the pre-owned market. However, attractive incentives in the new-vehicle market, as well as low interest rates, are providing some stimulus to the new-vehicle market,” he said.

Nedbank’s group economic unit said the non-existent base created by the strict COVID-19 lockdown makes it difficult to draw meaning from the new-vehicle sales numbers and a different base for comparison will probably be necessary for most of the second quarter.

It said by usual standards, the domestic market still has some catching up to do, particularly for passenger vehicles, while the historically low interest rates and attractive offers by dealerships will lend some support to sales in the months ahead.

Download an overview of the Naamsa sales figures here: AVAF Infographic NAAMSA April2021