Heels & Horsepower Magazine

Follow us :  

Facebook Twitter Instagram Youtube

Good start to the new year with impressive January car sales figures

vuyi on February 2, 2022

By H&H Admin

An increase in the cost of living at the start of 2022 did not discourage South Africans from buying new vehicles during January.

South Africans were faced with fuel price hikes and another increase in interest rates as the new year started, but that didn’t deter them from buying new vehicles during January.

According to naamsa | the Automotive Business Council, January new vehicle sales increased 19.5% to 41,382 units compared to the start of 2021, creating a solid start to the year and the market’s continued recovery.

“January new vehicle sales kicked off the year at similar levels to the momentum created during the second half of 2021,” says Lebogang Gaoaketse, Head of Marketing and Communications at WesBank, referring to four months of sales in the period exceeding 41,000 units. “While some purchase decisions may have been deferred out of December into the new year, January sales provide a solid start to the year, raising the hopes of manufacturers and dealers for ongoing market improvement.”

While year-on-year comparisons remain difficult to interpret because of differing pandemic circumstances, WesBank remained positive for a continued slow recovery of the market during 2022.

Both passenger cars and light commercial vehicles (LCVs) started the year positively, increasing 26.6% and 3.8% respectively. Dealer sales in the passenger car space out-stripped the overall market, increasing 33.7%, a very positive sign of consumer demand.

Sales into the rental market also indicate an increase in business confidence and a more positive outlook to tourism with sales in the channel up 21% during January.

“While gradual interest rate hikes are inevitable over the course of the year from their record lows, their impact should be considered within purchase decisions and affordability,” says Gaoaketse. “Rising costs of living amidst more slowly recovering earnings are expected to continue placing pressure on household incomes and the wherewithal for consumers to afford new vehicles during 2022. But price inflation in the pre-owned market and necessary replacement cycles some two years after the onset of the pandemic should be expected to fuel demand.”

SA Vehicle Sales Figures End 2021 On A Relatively High Note

vuyi on December 2, 2021

Press Release: Wesbank

South Africa’s new vehicle market has been faced with numerous challenges over the course of this year but sale seem to be on the rise.

South Africa’s new vehicle market has faced many challenges over the course of 2021.  However, the first interest rate hike in three years, consecutive fuel price hikes, a new variation on the pandemic theme and the return of load shedding didn’t deter sales too much.

The market’s resilience continued, recording 41,588 sales during November according to naamsa | the Automotive Business Council. This represents a 6.6% growth over the same period last year and a marginal improvement (553 units) over October.

“While it remains difficult to compare data over periods given the uncertainty of the pandemic for the past two years, a more certain sign of market improvement can be seen in a broader view of sales performance,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank. “During 2020, just two months of the year exceeded 40,000 units and those were the first two months, prior to lockdown regulations being put in place; five months of 2021 have recorded sales of more than 40,000 units, including the past four months consecutively. Market conditions are certainly improving.”

Year-to-date, the market has recorded 428,131 sales, up 24.8% on 2020’s 342,956.

The Passenger Car market increased 9.4% to 27,828 units. Dealer sales in the segment grew similarly by 9%, injecting much-needed confidence into the retail network’s sustainability as well as an indication of consumer confidence.

The Light Commercial Vehicle segment declined marginally (-0.8%) to 11,156 units with dealer channel sales slightly higher (0.2%) than November last year. 

The rental market once again provided a robust 4,771 sales across both segments, the current travel bans are likely to have an impact on this sector going into the new year.

“While the market is experiencing certain signs of continued recovery, the realities of rising interest rates and fuel prices is expected to impact affordability as household budgets still play catch-up from the ravages of the pandemic,” says Gaoaketse. “These factors are economically inevitable, but will certainly apply pressure to consumers.

Here are the sales figures for October 2021

vuyi on November 4, 2021

Press Release: WesBank

Stock shortages continued to thwart South Africa’s new vehicle market during October. However, the market continued to show a robust performance, despite the volumes being lower than September.

According to naamsa | the Automotive Business Council, 41,035 new vehicles were sold during October, an increase of 6.1% over the same month last year. Although September sales were the second-best volume month this year, October sales were 4.9% slower than last month. It is also important to note the context of October sales within the four months this year that have sold more than 40,000 units.

“The new vehicle market appears to be recovering strongly, demand out-stripping current supply constraints,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank. “The second half of the year has performed strongly since the mid-year lockdown restrictions, with the market trading above 40,000 units a month for the past three months.”

WesBank’s own data indicates a resurgence in the South African motor industry. “While we have seen high demand for pre-owned vehicles over the last two years, a slow shift back towards new vehicles may be currently underway,” says Gaoaketse. “Compared to a year ago, applications for to WesBank for new car deals rose 1.8% during October, while applications for pre-owned deals declined 5.9%. In addition, the bank’s used-to-new ratio has shifted over the 12-month period from 2.25 used vehicles financed for every new vehicle a year ago, to 2.08.”

However, the issue of supply is a global factor that skews the overall market picture. “Until global manufacturing stabilises off the back of the pandemic and resolves its micro-chip shortages, consumer and business purchase decisions will be swayed by availability and necessity,” says Gaoaketse. “The good news is that South African car dealers are in a much more sustainable position than a year ago.”

South Africa’s new passenger car market was up 3.1% to 27,496 units, displaying a robust consistency throughout the year. The Light Commercial Vehicle (LCV) market remains far more volatile. While it was down 10.9% in September, the segment bounced back to increase 15.9% during October to 11,188 sales.

A similar trend played out in the dealer space with passenger car and LCV volumes up 2.7% and 16.5% respectively. The market once again benefited from a sizeable volume of rental sales, with 5,002 passenger cars and 730 LCVs selling into fleets.

“Although the market looks in better shape, affordability continues to be a major consideration,” says Gaoaketse. “Significant fuel price hikes this month and the prospect of interest rates potentially increasing with the return of inflation are factors for consumers to consider when purchasing their next vehicle.” 

Car Tip of the Week: Here are the 3 most common types of service your car needs

vuyi on October 25, 2021

As the saying goes, prevention is better than cure and this applies to vehicle maintenance too!

There are 3 main types of maintenance service your vehicle needs and in order to get the best out of your vehicle and to keep it running optimally, all motorists should adhere to the car manufacturer’s service intervals.

When it comes to the type of service your vehicle is due for, largely depends on your car’s mileage. These are the different types of scheduled maintenance options:

  1. Basic service: This type of service is the most common and is routinely performed. In most cases it includes an oil change and oil filter, air filter and fluid checks, and is usually scheduled at 10,000km or 15,000km intervals. However, you should always refer to your car’s service book or speak to your Original Equipment Manufacturer (OEM) franchise dealer for information. 
  2. Advanced service: This service is generally set at further distance and time intervals, and can include the replacement of spark plugs, fuel filter, and pollen (cabin air) filters among other things.
  3. Major service: This is performed at even greater time and distance intervals. Major services can include the replacement of critical items such as timing belts and/or timing chains, and a detailed inspection of various mechanical components in your vehicle. 

Aside from the actual work performed, a service is also an opportunity for the technician or mechanic to inspect things that you as the owner may not be aware of. Compare it to a visit to the doctor: you can either go when you have an illness, or you can go for a regular check-up and see if they pick up a problem. 

Servicing your vehicle means that you will always be aware of the condition of your vehicle. For example, you may not know if your car needs a new wheel bearing or shock absorber, or that your brakes are nearing replacement time.

“Regular services allow the technician or mechanic to check for and inform you of any problem or issue before it becomes costly to replace or even fails completely, which could place both the vehicle and your safety on the road at risk. Mitigating risk at every turn is your responsibility as a vehicle owner,” says Kutlwano Mogatusi, WesBank’s Communications Specialist.

Tips To Help Protect Your Car’s Resale Value

vuyi on October 8, 2021

It is important to look after your vehicle by servicing it regularly and in accordance with the manufacturer’s stipulated service intervals.

Everyone says that the value of any vehicle depreciates the moment you drive if off the dealership floor.  This applies to both new and pre-owned vehicles; and while this is true in part, there are ways to protect and help maintain the value of your vehicle for future resale.

However, before we unpack some of the key factors that could affect the resale value of the vehicle, it is important to understand common terminology used by the motor industry when selling your vehicle.

  1. Retail price: This is the recommended selling price, excluding any optional extras. Dealerships incur costs such as marketing, insurance, vehicle reconditioning and repairs, facility overheads and staff remuneration. As such, the dealership needs to factor some profit into the vehicle price, so the retail value is normally at the higher end of the scale.
  2. Trade or market price: This is usually lower than the retail value, but may vary in line with vehicle demand.  The trade or market price is the value which should be considered when trading in or selling your vehicle.
  3. Depreciation: This refers to the reduction in the value of a vehicle over time, due to varying factors such as mileage, wear and tear damage etc.

If the vehicle also requires ongoing maintenance, it may be worth far less than you expected when the time comes to sell it.

Kutlwano Mogatusi, WesBank’s Communication Specialist

Photo Cred: Erick Mclean on Unsplash

The optimal time to trade in your vehicle

Used vehicle websites can be extremely valuable for researching which vehicles are the most popular, the fastest selling and have held their resale value over time. The optimal time to trade in one’s vehicle is when the trade value of the vehicle is more or less in line with the settlement amount owed to the bank.

“Variables such as mileage and the overall condition of the vehicle will also affect the resale value. It can be tempting to consider a bargain deal on a particular vehicle because it has a high mileage, but this could prove to be costly down the line. If the vehicle also requires ongoing maintenance, it may be worth far less than you expected when the time comes to sell it,” explains Kutlwano Mogatusi, WesBank’s Communication Specialist.

Photo Cred: Liam Briese on unsplash

Another useful tip is to resist over-embellishing your car with aftermarket accessories

Kutlwano Mogatusi, WesBank’s Communication Specialist

Simple tips to get the best resale value for your car

To ensure that you get the best price for your car, here are a few simple ways to maintain your car’s resale value:

  1. When buying your vehicle, choose the make and model carefully.  This includes the colour with white or silver being considered your best bet. Also consider that some brands are expensive to maintain or require more after-sales support than others.
  2. Keep a detailed service record.  Be diligent, stick to the maintenance schedule and keep a record of all work that has been done on your vehicle. A clean maintenance record will benefit you when it comes to negotiating the resell price of your vehicle.
  3. Use it, don’t abuse it.  This is self-explanatory and refers to all aspects of the car, from the brakes and transmission to paint chips, dented rims or a few dents –  all these elements will be checked by a potential buyer.
  4. Keep your vehicle’s papers in order.  These include the original vehicle registration form and proof of payment of the annual vehicle licence fee; you should also ensure there are no outstanding fines or e-Toll costs owing on the vehicle.
  5. Deal with the small issues:If you notice something wrong with your vehicle –  anything from an unusual sound in the engine to a few scratches – have it dealt with it immediately.  Not only will this help preserve it’s resale value, but it is always better to be safe than sorry.
  6. Use a reliable mechanic.  It is recommended that you service and maintain your car at a workshop with a good track record and trusted mechanics; remember that franchise dealerships have expert vehicle knowledge and qualified technicians who are specially trained to work on your specific brand.
  7. Where you park your car can also impact its resale value.   A closed garage is ideal, but this may not always be possible. Try not to leave your car parked under a tree or exposed in the sun for long periods at a time to maintain the exterior paint; also consider using a sun visor and even car seat covers to preserve the car’s interior.

Photo Cred: Chad Kirchoff

“Another useful tip is to resist over-embellishing your car with aftermarket accessories. While part of the joy of owning a car is making it your own, these personal style additions could impact negatively on its resale value. You might think oversized rims, outrageous body paint or a booming sound system are improvements but be aware that the next owner or the dealership where you plan to trade in your car, may not!” cautioned Mogatusi.

“Keeping your car clean and in as excellent condition as possible is probably the best way of ensuring it retains its value over time. A small scratch or dent might not seem like a big deal but accumulating dents or scratches over time will detract from the car’s overall appeal,” says Mogatusi.

WATCH: Here’s how the SA motor sector performed in September 2021

vuyi on October 7, 2021

New vehicle market continued to recover some momentum during September following the disruptions experienced in the economy during July.

Building on August sales successes, September sales continued to capture reassuring consumer demand and provided some reassurance for a stronger final quarter.

New Vehicle Sales Recovery Back On Track

vuyi on October 6, 2021

The new vehicle market continued to recover some momentum during September following the disruptions experienced in the economy during July. Building on August sales successes, September sales continued to capture reassuring consumer demand and provided some reassurance for a stronger final quarter.

According to naamsa | the Automotive Business Council, September new vehicle sales increased 15.8% to 43,130 units compared to the same month last year. More reflective of actual performance, the month’s sales were up 4% relative to August sales, which was the second-best sales month this year prior to September’s performance.

Although new vehicle sales are 30.1% up year-to-date to 345,172 units compared to the same pandemic-impacted period last year, WesBank continues to finance well over two used vehicles for every new vehicle.

While demand in the pre-owned market remains very strong, used car price inflation may begin impacting this momentum.

Lebogang Gaoaketse, Head of Marketing and Communication at WesBank.

The sales mix across new and pre-owned is an interesting factor impacting the sustainability of the motor retail sector during the pandemic.

“While the manufacturers are naturally focused on selling new vehicles, the pre-owned market influences brand affinity. However, on a retail level, sales are sales, whether new or used, providing mobility solutions to customers and cashflow for dealers,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank.

There’s no denying that the motor industry is facing unusual times. What has been prevalent throughout, however, is the sector’s unfailing resilience to prevail.

“While demand in the pre-owned market remains very strong, used car price inflation may begin impacting this momentum. That demand may become more about preferential specification than affordability in a time when the trade is paying a premium on certain pre-owned models,” says Gaoaketse.

“While stock availability in the new vehicle market remains stressed, forcing some consumers into the pre-owned market, the sheer demand remains encouraging for the industry once global stock shortages are alleviated,” Gaoaketse continued.

Most impacted by that stock situation is the Light Commercial Vehicle (LCV) market. LCV sales declined 10.9% during September compared to September 2020 to record 10,943 sales. This is 802 units or 6.8% less than last month. While dealer channel sales in this segment were less affected (down 7.2%), there is a noticeable lack of Government volume (down 64%) impacting the segment.

Driving the market growth was the 30.5% gain in passenger car sales year-on-year. September’s passenger car volume of 29,538 units was bolstered by 4,951 sales into the rental market and was 8.5% ahead of last month’s market. Dealer sales also swelled 17.3%, providing that much-need sustainability injection into the retail space.

“The Reserve Bank’s decision last month to maintain interest rates will continue to provide stimulus to the market, whether new or used with both sectors’ sales ultimately contributing to the overall recovery of the South African motor industry,” Gaoaketse concluded.

New vehicle sales on the rise in August 2021

vuyi on September 9, 2021

The new vehicle market bounced back during August after being unsettled by a barrage of impacts during July.

Not only did sales show good growth over the same period last year, but August’s new vehicle sales were the second highest this year at 41,425 units, after March’s figure of 44,217. According to naamsa | the Automotive Business Council, new vehicle sales were 24.6% up on August last year.

“Taking into account that July sales were significantly disrupted, the fact that sales were up 8.9% over June indicates some reparations from impacted July sales,” says Lebogang Gaoaketse, Head of Marketing and Communication at WesBank. August sales were 25.3% up over the skewed July new vehicle sales result.

WesBank shares the confidence expressed by motor industry CEOs during the first half of the year in a survey conducted by naamsa. “We have consistently held the optimistic view of recovery for the industry during 2021, with various signs showing growing confidence from both consumers and business,” says Gaoaketse. “To have this environment amplified by industry confidence will help to continue to build momentum in the market’s recovery, preserving jobs and fulfilling demand.”

Taking into account that July sales were significantly disrupted, the fact that sales were up 8.9% over June indicates some reparations from impacted July sales

– Lebogang Gaoaketse, Head of Marketing and Communication at WesBank

In terms of demand, WesBank believes the market is out-running the industry’s ability to supply. “Between the challenges of the pandemic, micro-chip shortages affecting international production – and therefore import supply to South Africa – and the prevailing market conditions that have simply hampered the free supply of certain models, the new vehicle market is poised to capture growth opportunities while trying to keep up.”

The trend towards the pre-owned market continues, driven primarily by affordability

– LEBOGANG GAOAKETSE, HEAD OF MARKETING AND COMMUNICATION AT WESBANK

The bank’s demand is measured by applications for finance that continue to sit at levels equivalent to or above those experienced prior to the pandemic. “This is reassuring in two senses,” explains Gaoaketse. “On one hand, consumers have been keeping their vehicles for longer, especially delaying purchases through the pandemic. This will create natural demand on the replacement cycle as consumers need to renew their ageing vehicles, probably with lower mileage.

“On the other hand, the current performance of the market is related to supply, rather than demand, meaning a healthy recovery for the industry is on the cards when stability returns to global production,” says Gaoaketse.

The outlook for the remainder of the year looks positive and will hopefully not be impacted by further lockdown restrictions

– LEBOGANG GAOAKETSE, HEAD OF MARKETING AND COMMUNICATION AT WESBANK

WesBank warns that not all that demand will go to new vehicles, however. “The trend towards the pre-owned market continues, driven primarily by affordability,” says Gaoaketse. “This remains good news for dealers in support of their viability across new and pre-owned showroom floors. Consumers will also benefit from better used vehicle stock once the replacement cycle activity kicks in, due to those low mileage vehicles that have been used less during lockdown.”

– LEBOGANG GAOAKETSE, HEAD OF MARKETING AND COMMUNICATION AT WESBANK

The growth in the market was shared across most sectors, including another strong performance from the rental sector, buying 4,962 units in total.

Passenger cars grew 40.5% over August last year to 27,157 units. Of these, 22,225 units were sold through the dealer network, 25% ahead of the same period last year, showing a resumption in demand and confidence.

The Light Commercial Vehicle (LCV) market was impacted less at 11,749 units, 3.8% ahead of August 2020. In fact, dealer sales were 1% down in this segment year-on-year.

“The market showed good recovery during August from the loss of momentum experienced in July. The outlook for the remainder of the year looks positive and will hopefully not be impacted by further lockdown restrictions or other unforeseen factors,” says Gaoaketse.

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.”

Follow the rules to avoid losing your licence

vuyi on July 14, 2021

The Administrative Adjudication of Road Traffic Offences (AARTO) Act that was expected to come into effect on 1 July 2021, will now be rolled out in a phased approach over the next twelve months. The rollout is expected to take a minimum of a year, with demerits and rehabilitation for bad drivers expected to come into effect between July 2022 and June 2023.

According to Lebogang Gaoaketse, WesBank Head of Marketing and Communication, AARTO remains in principle a much-needed initiative, the purpose of which is to promote safe driving and significantly reduce accidents, injuries, and fatalities on our roads.

“It is well known that most road accidents are preceded in some form or another by a road traffic transgression, so improving our attitudes and behaviour on the road is indeed a matter of extreme importance. The AARTO Act aims to do just that,” says Gaoaketse.

Road traffic injuries and road offences place a massive strain on national economies, but they also have an enormous effect on households

– Lebogang Gaoaketse, WesBank Head of Marketing and Communication

Many road incidents are avoidable, and history provides us with evidence that the right interventions can make a substantial positive impact. According to the World Health Organisation (WHO) – each year, more than 1.3 million people are killed on roads worldwide, and as many as 50 million are injured. It forecasts that there will be almost 1.8 million traffic fatalities annually by 2030.

We encourage road users to please abide by the rules of the road and by so doing, to play a much-needed and positive role in improving safety on our roads

– LEBOGANG GAOAKETSE, WESBANK HEAD OF MARKETING AND COMMUNICATION
Image: Pxhere

“Not only do road traffic injuries and road offences place a massive strain on national economies, but they also have an enormous effect on households. Families may be driven into debt by the loss of a sole income earner in the household, the expenses of prolonged medical care, or the added pressure of caring for a family member who may be disabled as the result of a road traffic injury. The costs also impose significant impact on the health, insurance, and legal systems, and overwhelming sadness and economic consequences to families,” says Gaoaketse.

When the demerit system comes into play, drivers will run the risk of having their drivers’ licences suspended. If they continue to break the rules, they may be required to redo their learners’ and drivers’ licences. In extreme cases they will be permanently banned from driving. Under the AARTO Act, fines will also be significantly increased in an effort to deter drivers from breaking the rules.

“While there have been delays, we support the principles of AARTO. We encourage road users to please abide by the rules of the road and by so doing, to play a much-needed and positive role in improving safety on our roads,” says Gaoaketse.