South Africa’s vehicle market ended 2009 on a relatively weak note, with the sales total for the whole year turning out a their lowest since 2003.
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Trade association Naamsa data recorded December vehicle sales at 30,478 vehicles, some 7.2% down on the previous year.
Vehicle sales for 2009 as a whole declined by 25.9% over the previous year to stand at 395,230 units, underlining the severe impact of the economic recession being experienced in South Africa. At the 2006 peak, South Africa’s vehicle market hit 714,315 units.
The 2009 car market was down by 21.6% to 258,132 units.
Naamsa nevertheless said that new car and commercial vehicle sales had, since the middle of 2009, started to show signs of bottoming out – albeit at historically low levels.
It said that most sectors of the South African automotive industry continued to be confronted with severe profitability and sustainability challenges in 2009. Pressure on automotive dealers over the past two years had been particularly intense resulting in a number of dealer closures and associated employment losses. Similarly, the auto parts production sector was also confronted by severe viability challenges as a result of significantly lower levels of production for both the domestic and export markets. A number of component manufacturing companies ceased operations resulting in additional job losses.
During 2009, vehicle manufacturers and importers were also forced to restructure their operations in response to the lower sales domestically and internationally.
Naamsa noted though that a bottoming of domestic demand had combined from the third quarter 2009 onwards, with a revival in demand for motor vehicles in international markets.
It said the improvement in export sales over the last four months of 2009 provided much needed support to vehicle producers and auto parts suppliers.
Naamsa also said that improved momentum in the used vehicle market meant it had ‘probably risen by about 15% to over 600 000 units’ and had therefore provided some relief to the automotive retail and distributive trade.
