Ending with a bang
March, traditionally the biggest sales month after October, lived up to expectations with 54 946 new vehicle sales recorded during this period by the National Association of Automotive Manufacturers of South Africa (Naamsa).
The Association reports that vehicle sales are up by 3,3 percent on February, but 2,1 percent lower when compared to March 2012 – which is in line with the expectations of a lower growth rate for this year. However, there is another culprit to blame for this decline in year-on-year expansion – the Easter weekend, which fell in March, resulted in fewer days available for sales.
But Toyota didn’t let this rain on its parade as the company sold 10 593 units – nearly 20 percent of all vehicles sold in South Africa during last month.
“March sales were boosted by several factors,” says Dr Johan van Zyl, president and CEO of Toyota South Africa Motors. “As the end of the quarter and the end of the fiscal year for many public and private companies, March traditionally sees large bulk purchases and final tender allocations. This is, of course, further supported by high retail activity from vehicle retailers who want to end the quarter in the black.”
He adds that these positive factors are counterbalanced by increasing pressure on disposable income, with several fuel price increases and continued food price inflation putting a damper on household spending. However, the company’s light commercial vehicle sales remained buoyant thanks to its Hilux sales – 3 637 units – while medium, heavy and extra-heavy commercial vehicles recorded mixed successes.
As for the rest of the year, Toyota’s sales estimates are supported by the finance applications and approvals of Toyota Financial Services, which reports a 7,59 percent decline in finance applications in March. However, it states that there is an overall increase of 9,9 percent in applications for the quarter.
“We expect vehicle sales to return to growth for the rest of the year, albeit at a much slower pace than in 2012,” says Van Zyl. “This expectation takes into consideration a lower rate of GDP growth and continued pressure on disposable income, on the one hand – and continued marketing, many new vehicle introductions and a low interest rate environment on the other.”