The continuing growth in new vehicle sales in South Africa continues to confound forecasters, says the National Automobile Dealers’ Association (NADA).
It was reacting to the release of sales data on Monday that revealed that South Africa’s new vehicle market grew total sales by a higher than expected 13.9% to 528 963 units in 2022 from the 464 493 unit-sales recorded in 2021.
Gary McCraw, a director of Nada, highlighted that what is amazing about this growth is that it was achieved in a year that Toyota lost about 70 000 units of local production because of the disastrous floods in KwaZulu-Natal, which put its plant out of action for four months.
“Not only did all the dealers survive, but they showed agility as they switched to selling far more imported cars than usual, benefitting from ongoing, practical support from the Toyota head office and field staff, which undoubtedly made these challenging times more manageable,” he said.
McCraw added that bumper sales in December 2022 meant that South Africa's new vehicle market recorded growth for the 12th consecutive month with sales of 41 783 units, which was a "stunning" 16.2% higher than December 2021.
“We are particularly pleased that the retail sales channel was responsible for delivering 37 479 units or 89.7% of the total vehicles sold in December, which is excellent for the health of these dealers who are still recovering from the lengthy COVID-19 lockdowns.
“The annual aggregate sales figure of 528 963 units was not only 13.9% higher than in 2021 but only 1.4% below the 2019 pre-pandemic figure of 536 612 units,” he said.
McCraw said NADA expected the new vehicle market in South Africa to continue growing in 2023 “but maybe not at the rate previously anticipated”.
He attributed this lower sales growth outlook to the fact that many of the factors that hobbled the motor industry in 2022 would unfortunately still be encountered in 2023.
McCraw said these factors include recurring load shedding at various stages of severity, interest rate pressures, fluctuating currency, fuel prices and a decline in the disposable income of consumers.
He said the local and global vehicle markets were proving extremely volatile and, in many cases, were performing unpredictably.
McCraw said there have been major mitigating factors, such as the COVID-19 pandemic, which wrought havoc in the automotive industry, together with supply chain constraints, the impact of severe weather conditions across many countries and the war in Ukraine.
However, McCraw said the markets were likely to remain unpredictable in 2023 even without significant disruptors.
“The South African retail motor industry has had to face challenges for several years now and is proving very resilient and innovative in keeping sales volumes running at a reasonable rate,” he said.
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