April’s glimmer of hope for new vehicle sales was short-lived as May resumed their slump and the status quo of a steady decline in performance resumed. Industry sales for May declined 5.7% to 40 506 units compared to May 2018, according to figures released by the National Automobile Association of South Africa (Naamsa).
Ghana Msibi, WesBank executive head of motor, said: “We had warned against hopes of a major turn-around last month. May sales return to a picture more representative of the rest of the year.” April sales had represented a marginal 0.7% increase in sales within a traditionally short sales month.
There were no winners in the various segment performances, apart from a marginal 0.3% gain in medium commercials. Passenger cars declined 1.4% to 26 170, while light commercial vehicles (LCVs) traded 13% down year-on-year. While volumes month-on-month increased during May, this is as a result of a standard sales month versus April’s fewer selling days.
Msibi further adds: “Dealers continued their swings-and-roundabouts experience, scoring on passenger cars and losing on LCVs.”. Demand for passenger cars through the retail network translated into a 2.6% increase in sales through this channel. But consumers were less-interested in LCVs, dealer channel sales losing 15.1% in this segment. Rental market performance was also low on demand during May.
Market performance year-to-date paints a slightly more positive picture, breaking through the 200 000-unit volume barrier. Year-to-date sales are down 4.1% contributed to by segment declines of 5.3% and 2.3% for passenger cars and LCVs, respectively.
Msibi concludes: “Despite these really tough trading conditions, demand appears to be more positive according to increased applications for both new and used finance according to WesBank data. Hopefully more certain trading conditions for the remainder of the year can convert this demand into deals.”