New vehicles below R400 000 driving growth in SA market

THE good times are rolling in South Africa’s new vehicle market, with nine consecutive months of sales growth putting the industry 13.6% ahead of where it was this time last year, Naamsa figures show.

- JASON WOOSEY

June was a particularly strong month for the motor trade, with year-on-year sales growing by 18.7% to 47294 units, as passenger cars and light commercial vehicles made solid gains of 21.7% and 14.9% respectively. But household budgets remain tight and much of the growth is concentrated at the lower end of the vehicle market.

“The majority of the growth we're seeing is centred in the sub-R400000 segment,” said Brandon Cohen, the chairperson of the National Automobile Dealers’ Association (Nada).

“This price point remains critical for volume, affordability and trade-ins, with a direct knock-on effect on preowned sales performance,”

He said the used vehicle market was also benefiting from improved affordability metrics, driven by softened interest rates, favourable vehicle pricing, and the rollout of the two-pot retirement savings reform.