South African new vehicle sales declined by 28.3% to 34,176 units in November on the back of a weakening economy, according to data released by the National Association of Automobile Manufacturers (NAAMSA).
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New car sales were 20,128 units in November, a decline of 31.4% on the same month last year.
NAAMSA said that the South African automotive new and used vehicle retail sector continued to experience ‘severe financial distress’.
It said that the combined impact of recent above average vehicle price inflation, the high interest rate environment, the negative wealth effect as a result of falling house prices and asset values, sharp falls in business confidence and consumer sentiment was expected to continue to exert further pressure on domestic sales.
However, NAAMSA held out the hope that as inflationary pressures abate interest rates should come down.
Markets and some analysts are expecting a rate cut next week.
Meanwhile, Nissan has said it is considering cutting 220 jobs in South Africa. The company said in a statement it would start consultations with unions about the possible cuts this month.
