New vehicles sales ‘strong’ in December

New vehicle sales in December were good, improving by almost 30% compared with the previous year, the National Association of Automobile Manufacturers of South Africa (Naamsa) said on Monday.

“New vehicle sales statistics ended the year 2010 on an exceptionally strong note with aggregate industry new vehicle sales at 39 504 units for December 2010,” Naamsa said in a statement. This was an almost 30% improvement on the total new vehicle sales of 30 407 units during December 2009.

The performance was encouraging across all sectors, particularly the new car segment, which was up by almost 40% for December 2010 compared with December 2009.

New vehicle sales for the whole of 2010 improved by 25% compared with 2009.

“Importantly, the improvement should be seen in relation to the depressed sales levels and low base during 2009 as a result of the impact of the global financial and economic crisis at the time, compounded by a recession in the domestic economy,” Naamsa said.

However, the 2010 figures were still well below the annual aggregate sales in the years 2005 to 2008.

Naamsa said the industry trade conditions in 2010 were “intensely competitive”.

“Initial calculations indicated the motor industry new vehicle-related sales turnover had improved by about 20% during 2010 to reach about R130-billion for the year.”

The used vehicle market was estimated to have reached about 600, 00 units.

World Cup benefit
Naamsa said the industry benefited from the Soccer World Cup through the effect it had on economic activity levels, tourism, car rental and transportation businesses.

The industry was also positively affected by the increase in consumer spending during the second and third quarters of 2010 largely in response to lower interest rates.

“However, growth in fixed investment remained relatively subdued.”

The strikes in the automotive industry in August and September negatively affected the industry, leading to “a significant loss of production of automotive components and built-up vehicles”.

“The normalisation of production during the third quarter of 2010 did, however, contribute to a significant recovery in output.”

In September 2010, a carbon emissions tax was introduced on new cars that affected the affordability of vehicles, Naamsa said.

The industry was also affected by the strong rand.

“The strength of the rand throughout most of 2010 impacted on automotive industry exports, particularly exports of original equipment and replacement components.” — Sapa

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