Along with sound seasonal sales to the vehicle rental industry and five consecutive months of lower consumer inflation, a second interest rate cut of 25 basis points by the South African Reserve Bank during the month sparked positive sentiment.

Reflecting on the new-vehicle sales statistics, the automotive business council, naamsa, says a second consecutive increase in the monthly new-vehicle sales could signal the start of the long-awaited upward trend in the new-vehicle market.

Aggregate domestic new-vehicle sales in November 2024, at 48 585 units, reflected an increase of 3 658 units, or a gain of 8.1%, from the 44 927 vehicles sold in November 2023. Export sales decreased by 12 210 units, or 28.6%, to 30 431 units in November 2024 compared with the 42 641 vehicles exported in November 2023.

Overall, out of the total reported industry sales of 48 585 vehicles, an estimated 39 450 units, or 81.2%, represented dealer sales, an estimated 14.6% represented sales to the vehicle rental industry, 2.4% to government sales, and 1.8% to industry corporate fleets.

The November 2024 new passenger car market, at 35 101 units, had registered an increase of 5 849 cars, or a gain of 20.0%, compared with the 29 252 new cars sold in November 2023. Car rental sales accounted for a sound 19.5%, or one out of five new passenger vehicles sales during the month.

Domestic sales of new light commercial vehicles, bakkies and mini-buses, at 10 827 units during November 2024, recorded a decrease of 2 110 units, or a loss of 16.3%, from the 12 937 light commercial vehicles sold during November 2023.

Sales for the medium and heavy truck segments of the industry reflected a weak performance in November 2024 and at 699 units and 1 958 units respectively, recorded a decrease of 71 units, or 9.2% from the 770 units sold in November 2023 in the case of medium commercial vehicles, and, in the case of heavy trucks and buses, a decrease of 10 vehicles, or 0.5%, compared with the 1 968 units sold in the corresponding month last year.

In view of the stronger year-end performance, new-vehicle sales were now only 3.5% below the corresponding period in 2023, but unlikely to return to the pre-pandemic level after four years in 2024. Further interest rate cuts in the new year should support vehicle affordability across all the various segments.

The ABSA Purchasing Manufacturers’ Index measuring expected business conditions in six months’ time remained steady in November 2024, indicating that manufacturers remain positive about business conditions going forward.

The Central Bank stated that risks to the country’s growth outlook are assessed to be balanced, but that growth could be higher from next year, given ongoing reforms. These include structural reforms, especially in the network sectors, such as electricity and transport. Furthermore, the recent positive outlook on South Africa’s credit rating, from Standard and Poor’s, points to an improving country risk premium.

• In his reaction Brandon Cohen, Chairperson of the National Automobile Dealers’ Association (NADA), says November was a robust month for passenger car sales, fuelled by growing consumer demand and bolstered by a strong contribution from the rental market, which accounted for 19.5% of passenger car sales. “November is traditionally challenging for the motor industry, as many consumers postpone purchases until January to benefit from new-year registrations or await year-end bonuses, typically paid in December. Despite these factors, dealers have navigated the month with careful strategies, considering the competitive environment,” Brandon adds.