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July 2021 Car Sales Figures Take a Knock

vuyi on August 3, 2021

Civil unrest and adjusted Level 4 lockdown had a negative effect on car sales during the month of July 2021. Lebogang Gaoaketse, Head of Marketing and Communication at WesBank gives us the break down

The momentum being gathered in South Africa’s new vehicle sales recovery was given a harsh blow during July as civil protests tore through large parts of the country. In addition, the majority of the sales month was spent in adjusted Level 4 lockdown and the ongoing impact of stock shortages was exacerbated by disruptions in the logistics chain at ports.

July brought the fragility of the motor industry back into stark focus.
– Lebogang Gaoaketse, Head of Marketing and Communication at WesBank

“July brought the fragility of the motor industry back into stark focus,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank. “Not only did the month bring physical impacts, but the resulting consequences in business and consumer confidence will continue to challenge the industry’s recovery for months to come. Once again, the industry’s resilience is being put to the test.”

WesBank remains optimistic, however, for the industry’s continued recovery. “Rejuvenation of rental fleets, progress in the country’s vaccination rollout programme and revitalisation of the economy in general will all contribute towards building the South African motor industry,” says Gaoaketse. “The industry needs to remain focused on delivery and the inevitable demand that will rise in the medium term.”

Although July sales recorded 1.7% growth year-on-year to 32,949 units according to naamsa | the Automotive Business Council, the month declined 13.6% compared to June sales. WesBank says the market experience was reflected in demand, with the bank’s application rate comparatively slower.

While the country encountered yet another speed bump during July, there are many reasons to believe in the continued recovery of the market.
– – LEBOGANG GAOAKETSE, HEAD OF MARKETING AND COMMUNICATION AT WESBANK

The passenger car segment grew 9.1% year-on-year to 20,575 units but that was a far cry from the 24,497 units sold in June. The real effects of consumer confidence can be seen in the dealer channel sales, down 1.1% year-on-year and significantly worse off (-15.8%) than June.

Light Commercial Vehicle (LCV) sales hurt even more, down 8.1% at 10,266 compared to 11,165 in July last year. Sales through the showroom floor also got dealt a 9.8% knock and the picture compared to last month’s sales, was significantly worse.

“While the country encountered yet another speed bump during July, there are many reasons to believe in the continued recovery of the market,” says Gaoaketse. “Low interest rates, the return of adjusted Level 3 lockdown regulations, and some improvement to civil stability will provide a good basis for the industry’s determination to once again shine through.”

Cars in lockdown: Keep an eye on your service schedule

vuyi on May 20, 2021

Whether you rely on an old-school service booklet in your cubbyhole or a clever onboard system that displays a notification on your car’s instrument cluster, it’s important to keep a close eye on service schedules in order to not miss an important workshop visit.

With the effects of the pandemic still impacting regular commuting patterns and social distancing measures resulting in alternative work arrangements, many South African drivers simply aren’t accumulating the same distances as they were pre-Covid 19.

While lower mileages do come with the potential of increased vehicle trade-in or resale values further down the road, they also mean that servicing routines have been thrown out of kilter for those drivers who normally reach distance allowances before allotted time intervals.

There have been a number of recent instances at NADA member dealers where customers have missed their service deadlines
– Mark Dommisse, Chairperson of the National Automobile Dealers’ Association (NADA)

Whether you rely on an old-school service booklet in your cubbyhole or a clever onboard system that displays a notification on your car’s instrument cluster, it’s important to keep a close eye on service schedules in order to not miss an important workshop visit.

“There have been a number of recent instances at NADA member dealers where customers have missed their service deadlines,” said Mark Dommisse, Chairperson of the National Automobile Dealers’ Association (NADA). “In many of these cases, it’s because vehicle owners are driving less, and they aren’t aware that service schedules are based on a combination of distance and time allowances.

Where possible, these dealers and respective Original Equipment Manufacturers (OEMs) will work with customers to reach amenable solutions, but it’s important for owners to know that the responsibility for servicing their vehicles at the right time lies with them.”

It’s also important to remember that service intervals are not standardized across all vehicles and vehicle brands
– MARK DOMMISSE, CHAIRPERSON OF THE NATIONAL AUTOMOBILE DEALERS’ ASSOCIATION (NADA)

Depending on which carmaker is involved, and by how much a service deadline is missed, failure to adhere to your car’s service schedule can result in various penalties.

In very minor cases it’s possible that a respective OEM will overlook the lapse as a gesture of goodwill, but this is a leeway that certainly should not be relied upon as a get-out-of-jail-free scenario.

Various brands will handle lapse situations differently, but generally speaking, a failure to have your vehicle serviced on time can make warranties and/or service plans immediately voidable. In certain instances, these can be reinstated with an extensive vehicle check – at a customer’s expense – but in severe cases, a completely voided warranty can have a devastating impact on the value of your asset. If your car is financed there may be further implications, as vehicle maintenance forms part of the loan terms agreed with your bank.

Today’s dealers will often call customers ahead of planned services, but this is an added courtesy and should not be relied upon
– MARK DOMMISSE, CHAIRPERSON OF THE NATIONAL AUTOMOBILE DEALERS’ ASSOCIATION (NADA)

“It’s also important to remember that service intervals are not standardized across all vehicles and vehicle brands,” added Dommisse. “It appears there may be a common misconception that schedules are set at 15,000km or one year, regardless of what vehicle you drive and this is definitely not true. I recommend familiarizing yourself with your particular vehicle’s service schedule, either by looking in your owner’s manual or service booklet or by calling your nearest franchise dealership for information.

“Today’s dealers will often call customers ahead of planned services, but this is an added courtesy and should not be relied upon. Again, the onus of meeting maintenance deadlines falls solely on the customer. Even if your car is out of plan, it’s a good idea to keep on top of vehicle upkeep. Not only will this potentially increase its value, but it’s also good for the health of your car.”

NADA is a constituent association of the Retail Motor Industry Organisation (RMI).

A look at vehicle sales figures one year since lockdown began.

vuyi on April 6, 2021

As the country observed the first-year anniversary since lockdown commenced, new vehicle sales provided reason for the industry to celebrate.

Twelve months ago, the country reeled to news of the pending lockdown as showrooms prepared to close their doors, consumers headed home, and vehicles were only let out for essential services. In March 2020, the new vehicle market plummeted 29.7% compared to March 2019 to record just 33,545 sales. The grip on the South African motor industry had tightened quickly.

One year later, the resilient industry is fighting a hard recovery. But March 2021 sales put one of their best feet forward.

With interest rates remaining stable at their low levels, a constantly – albeit slowly – improving supply of imported vehicles, and a slightly healthier economy operating within eased levels of restrictions, we expect the market to continue recovering well.
– Lebogang Gaoaketse, Head of Marketing and Communication at WesBank Vehicle and Asset Finance

“Reassuringly, March sales show a 18.4% increase over February this year, a number more indicative of the real strength of the market,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank Vehicle and Asset Finance. “With many of the brands indicating difficulty securing sufficient stock to meet demand, the new vehicle market seems to be well on its way to recovery.”

Passenger car sales were up 23.4% to 27,330 units year-on-year and 13.2% up on February 2021. With some renewed activity in the rental market, the consumer demand was noticeable with dealer sales in the segment up 24.2%.

Light Commercial Vehicles (LCVs) delivered a staggering 52.4% improvement over March last year to sell 14,375 units. This performance means the LCV segment is up 13.2% year-to-date and hopefully represents a surge in business confidence. The majority of activity in the segment remained on the showroom floor with dealers selling 61.1% more bakkies than they did a year ago.

“With interest rates remaining stable at their low levels, a constantly – albeit slowly – improving supply of imported vehicles, and a slightly healthier economy operating within eased levels of restrictions, we expect the market to continue recovering well,” says Gaoaketse. “While we have seen a significant increase in the average deal size financed by WesBank, we don’t expect new vehicle prices to increase dramatically. This will also provide added stimulus to the market and is a positive sign of consumer sentiment and ability to participate in the new vehicle market.”

The strong March performance made an encouraging impact on year-to-date sales. First quarter sales are just 0.9% down on the same period last year with 116,225 sales recorded during the first three months.

New record for Suzuki dealers in first full month of post-lockdown sales

vuyi on July 13, 2020

Suzuki Auto South Africa has surprised the market with a stellar sales performance in June, with sales figures returning to pre-lockdown levels and its dealer network breaking all existing records.

The S-Presso seems to be the perfect vehicle for cash-strapped South Africans looking for a reliable new car
– André Venter, divisional manager sales and marketing – Suzuki Auto South Africa

“All credit goes to our national dealer network, which worked very hard to reopen all their dealership floors, while meeting government and Suzuki standards for sanitation and safety. Their rapid action allowed us to meet the pent-up demand for good quality, affordable vehicles such as our new S-Presso and popular Swift,” says André Venter, divisional manager for sales and marketing at Suzuki Auto South Africa.

According to the National Association of Automobile Manufacturers (Naamsa), Suzuki Auto SA has leapt up the sales charts by selling 1 433 units, with all but one unit sold through the dealer network. This not only ranks Suzuki 7th overall in the sales rankings but gives it a 4.49% share of the total vehicle market and a 7.17% share of the passenger vehicle market.

We will support our dealers as they continue to trade under difficult circumstances
– ANDRÉ VENTER, DIVISIONAL MANAGER SALES AND MARKETING – SUZUKI AUTO SOUTH AFRICA

The S-Presso has proven to be a very popular new model, with a massive 555 new units finding new homes in June. This is the model’s first full month of sales, after Suzuki cancelled its in-person launch and launched it digitally shortly before of the start of South Africa’s national lockdown.

“With a starting price of only R139 900, a service plan and 5-year warranty included, the S-Presso seems to be the perfect vehicle for cash-strapped South Africans looking for a reliable new car. Its design as a compact SUV, with more interior space and high ground clearance, certainly helps,” says Venter.

Other Suzuki models that have proven popular after sales restarted, include the Suzuki Swift (297 units), the Ignis (86 units) and the Jimny 4×4 (249 units).

…we have been forced to increase our support staff and available parts storage
– ANDRÉ VENTER, DIVISIONAL MANAGER SALES AND MARKETING – SUZUKI AUTO SOUTH AFRICA

While the entire automotive market has not recovered in step with Suzuki, it is heartening to see a return of general sales activity. Naamsa reports that 31 867 vehicles were sold in June, which is significantly up from the 12 874 vehicles sold in May. It remains well below the 45 953 units sold in June last year and it is a full 105 054 vehicles fewer than in the first six months of 2019.

(Photo by Cornel van Heerden) www.cornelvanheerden.com

“It was impossible to predict the COVID-19 pandemic and subsequent lockdown or to fully gauge its impact on dealer health, but based on June’s sales it looks like there is a glimmer of hope for the auto industry. We will support our dealers as they continue to trade under difficult circumstances and will fully support the industry, which remains a very significant investor and employer in South Africa,” says Venter.

(Photo by Cornel van Heerden)
(Photo by Cornel van Heerden)
(Photo by Cornel van Heerden)
(Photo by Cornel van Heerden)

Suzuki last year celebrated its first ten years in South Africa with a new all-time sales record for the year and the introduction of exciting new models such as the Swift and Swift Sport. This year, it hopes to maintain this momentum by moving into new corporate offices, with adjacent parts storage.

“With the growth in our car parc and dealer network, we have been forced to increase our support staff and available parts storage. We have already identified a new corporate head office and warehouse facility in Johannesburg and will move as soon as it is safe to do so,” says Venter.