In amplification of the new vehicle sales statistics for the month of July, 2010 – released today by the National Association of Automobile Manufacturers of South Africa (NAAMSA) – the Association commented that new vehicle sales had recorded a mixed performance with new car sales registering creditable gains but new light commercial vehicle sales showing signs of weakness. On balance, the latest aggregate sales numbers confirmed expectations of a moderation in the underlying growth momentum in the various sectors. In the event, aggregate industry sales at 41 367 units had registered an improvement of 6 895 vehicles or 20,0% compared to the 34 472 vehicles sold during the corresponding month in 2009. The year on year monthly improvement was below the 23,3% growth for the first seven months of 2010 and this in turn implied, as expected, slower growth. Aggregate export sales had registered strong gains during July, 2010 in relation to the very low base figure of the corresponding month in 2009 when exports had been particularly badly affected as a result of the impact of the global financial and economic crisis at the time.
Overall, out of the total NAAMSA reported industry sales of 35 555 vehicles, 84,7% or 30 106 units represented dealer/retail sales, 8,5% represented sales to the car rental industry, 3,7% represented industry corporate fleet sales and 3,1% sales to government.
Aggregate industry new car sales during July, 2010 had been at the upper end of expectations and at 29 221 reflected an improvement of 7 159 units or 32,4% compared to the 22 062 new cars sold by the industry during July, 2009. The selling rate of new cars per day remained relatively robust.
However, in contrast to the relatively buoyant new car market, sales of industry new light commercial vehicles, bakkies and minibuses at 10 375 units during July, 2010 reflected a decline of 310 units or 2,9% compared to the 10 685 units of the corresponding month last year. The new light commercial vehicle sales cycle had slowed significantly compared to previous months.
July, 2010 sales of vehicles in the medium and heavy truck segments of the industry also reflected a mixed picture and at 616 units and 1 155 units, respectively, had recorded an increase of 58 units or 10,4%, in the case of medium commercials, and a slight decline of 12 units or 1,0%, in the case of heavy trucks and buses – compared to the corresponding month last year. The growth momentum in the medium and heavy commercial vehicle segments had also slowed significantly.
Export sales of South African produced vehicles during July, 2010 at 23 246 vehicles registered a gain of 12 038 units or an improvement of 107,4% compared to the 11 208 vehicles exported during July last year when export sales had been extremely depressed as a result of the global financial crisis. Year to date new vehicle exports at 130 025 units had reflected an improvement of 38 361 vehicles exported or 41,8% compared to the 91 664 export sales during the corresponding seven months of 2009.
The 5½% decline in interest rates since end 2008, stable new vehicle prices, further improvement in loan finance approval rates – as well as pent up replacement demand – continued to support the new car market. In contrast, the new light, medium and heavy commercial vehicle sales cycle had slowed substantially. Continuing uncertainty about the strength and sustainability of the global economic recovery could impact negatively on volume growth over the medium term, particularly in the case of export sales. Other domestic economic performance indicators such as the Purchasing Managers Index and subdued private sector credit extension, suggested that domestic economic conditions going forward would remain challenging.
Over the balance of 2010, the rate of growth in new vehicle sales was anticipated to moderate and, at this stage, aggregate domestic sales for 2010 were projected to expand by about 15% for the year, whilst export sales were projected to grow by around 30% in unit terms. Factors that would influence domestic sales volumes during the remaining months of the year included the overall performance of the domestic economy, the inflationary consequences of the impending CO2 new car tax regime and the outcome of the current round of collective bargaining in the various sectors of the industry.

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Wilhelm Lutjeharms