South African new vehicle sales fell 18,1% in September compared with the same month last year, and were likely to stay under pressure through to the end of the year, partly because of high interest rates.
The National Association of Automobile Manufacturers (Naamsa) said on Thursday new vehicle sales were down at 40 955 units from 49 996 in September 2007. The September 2007 figure was depressed by a strike in the automotive component sector that affected production and sales.
Including sales from Associated Motor Holdings, whose data is presented separately as it does not fulfil all of Naamsa’s reporting requirements, total sales fell to 44 725 vehicles in September from 55 645 last year.
”During the last quarter of 2008, domestic new vehicle sales [are] likely to remain under pressure as a result of the cumulative impact of past interest-rate rises, inflationary pressures, a decline in the real purchasing power of consumers and lower economic activity levels,” Naamsa said.
The central bank has raised rates by five percentage points since June 2006 as it grapples with soaring inflation, but left the key repo rate unchanged at 12% last month, citing an improved inflation outlook for 2009.
The South African Reserve Bank’s monetary policy committee holds its next policy meeting next week and Governor Tito Mboweni is due to announce a decision from about 3pm on Thursday.
”Even though the worst period of rising inflation and interest rates is behind us, sales are likely only to find new impetus from the second half of next year, when lower inflation and interest-rate relief have had time to ease pressure off consumers’ stressed financial positions,” said Standard Bank economist Danelee van Dyk. —