South Africa’s car market could bounce back to close to 300,000 units a year, a figure not seen since the heady days of the early 1980s, the Made in South Africa automotive conference in Port Elizabeth heard today.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
Anthony Twine of Johannesburg-based Econometrix, told more than 150 delegates at the first conference of its kind in the city that his company was forecasting 271,000 passengers sales this year, rising steadily to 295,000 by 2009.
But he urged SA’s auto industry to secure its domestic market as a priority before worrying about exports. “The domestic market matters because there is finite production capacity in SA. We need to learn from the Japanese who made sure that the domestic market for its products – not just automotive products – was secured first before export markets.
“The world has changed since those times, but the Japanese are a shrewd bunch of people. There still might be a great deal of merit in securing that home market. Players in the SA market would be well advised not to ignore the upside potential that exists in the next 10 years.”
Twine based his forecast on strong economic indicators. “The outlook on the rand is for it to stay at current levels which is cosy for consumers but bad for producers,” said Twine. The main danger was unexpected inflation, he said.
Since 1994, GDP had averaged 2.7% a year and he was predicting that it might reach 3% this year. “We are forecasting 3.5% growth between 2005 and 2010, the most sustained period of growth since the 1970s,” said Mr Twine who reminded delegates that SA’s economy today was 54% bigger than it was in 1980.
Econometrix’s best forecast for GDP was 4.5%. “If we do that we will be flying so hard that we won’t have to worry whether it could reach 6%,” he said.
