NADA Comment: Encouraging new vehicle sales throughout the first quarter but setbacks could be on the cards

New vehicle sales in April were 17.6% down from last month, but still showed encouraging signs of market recovery when considering it was an especially short trading month with only 19 selling days.

“Sales results were better than expected, despite April being the shortest trading month bookended with public holidays and long weekends. There was the added complication of staggered school holidays affecting business too,” said Mark Dommisse, the Chairperson of the National Automobile Dealers’ Association (NADA), when commenting on local retail vehicle sales for April 2021.

April sales figures reported by naamsa showed an aggregate of 35 779 units sold, with

31 482 of these coming from dealers. Sales through dealer retail channels in April were estimated at 88.0% of total sales, with the rental industry taking 7.5%, 2.4% of sales going to the government and 2.1% to industry corporate fleets.

“We cannot compare sales with April 2020 as we were in the harshest Level 5 lockdown at this time last year, with only 574 new vehicles being sold that month and only 275 through the dealer network. It’s also difficult to track where we are quarter-on-quarter, but with an average of 36 000 units sold over the first four months of 2021 the new car market is in a relatively healthy state,” said Dommisse.

“We must be mindful, however, of potential setbacks in coming months. In contrast to 2020, we have customers, but a shortage of many models due an increasing number of global logistical challenges are impacting negatively on the current and future new vehicle stock availability in South Africa. We’re experiencing a global scarcity of microchips, as well as steel, resin, and rubber.

“We now unfortunately have the added complication of severe lockdowns in India, limiting production. India is a large source of built-up vehicle imports, particularly in the entry level segment of the market,” added the NADA Chairperson.

“The large-scale vaccination programme in South Africa cannot start fast enough to bring more normality to the country. Kudos to the government for accelerating the supply of vaccines, with more than 300 000 batches arriving early on Monday morning and more expected in the next few weeks,” concluded Dommisse.

Please note: This content is relevant for May 2021. Please contact Meropa Communications for any updates if the content is going to be utilised thereafter.

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