Nov 29, 2021 Pieter Wessels, Lightstone Auto.
Passenger vehicles leading the pack in new vehicle sales recovery
Over the past two years, new vehicle sales have gone through a series of peaks and troughs, directly impacted by global lockdown restrictions, parts shortages, and civil unrest.
New vehicle sales in South Africa have yet to experience the full impact of the global semi-conductor shortage, which has affected sales in several overseas markets and continues to limit vehicle production around the world.
“A precursor to the expected impact is that several premium brands have suffered a dip in domestic sales due to stock shortages,” says Pieter Wessels, Managing Director of Lightstone Auto.
Encouraging, however, is that new vehicle sales in September 2021 (43 146 units) were 16% up from September 2020, according to NAAMSA, and 3.9% up from August 2021, as the market continues to recover from Lockdown Level 4 and July’s civil unrest.
Passenger vehicles leading the pack
Passenger vehicle sales grew by 30% year-on-year in September to 29 537 units, but Light Commercial Vehicles sales were 11% down, dropping to 10 940 units, when compared with September 2020.
Overall sales for the first nine months of 2021 were 30% higher than for the first nine months of 2020, but still 13% down from 2019. So far, NAAMSA has reported a total of 345 502 units sold in 2021, of which around 84% represent dealer sales.
Passenger vehicle sales were up 32%, and sales of LCVs increased by 28% compared to the January to September 2020 window. The car rental industry accounted for an estimated 14% of new Passenger Vehicle sales between January and September 2021 - well ahead of the 8.4% share in the 2020 window which compares favourably with the 16% in 2019.
The Entry Segment was the largest Light Vehicle (Passenger & LCV markets) segment for the first nine months of 2021. Sales for the Entry segment picked up 40% from the nine months ending September 2020, which in turn was 36% down in the same period of 2019.
The second-best performing segment in terms of volume was the Crossover segment, with 57 167 units sold in the nine months leading up to September 2021. This segment has strengthened from the same period in 2020 by 74%.
“That 74% year-on-year growth enjoyed by the Crossover segment thus far in 2021 makes Crossovers the best performing Light Vehicle segment in terms of sales growth. The accelerated growth in this segment makes it one to watch for dealers who are trying to bring in fast-moving stock items,” advises Pieter Wessels.
Over this nine-month period, the Crossover segment makes up 18% of all Light Vehicle sales, up from the 13% market share this segment enjoyed a year ago.
The next most improved segment over the first nine months is the MPV segment, with a year-on-year jump of 60% over the nine months to September 2020.
Outlook for the rest of 2021
The market outlook for 2021 has improved marginally on the back of a fairly strong end to the third quarter, whilst GDP is still expected to grow, headline consumer inflation is likely to remain well within the Reserve Bank’s target range and interest rates are expected to continue at relatively low levels.
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