Picture: ISTOCK
Picture: ISTOCK

Motor industry marketers were entitled to give a half-hearted cheer on Monday when sales figures showed a slowing in the rate of decline in new-car sales.

In January and February, the market plunged 10.8% and 13.3% respectively from the corresponding months in 2018. It fell again in March but at 5.6% — from 32,153 to 30,348 — the drop was almost respectable.

Still, the numbers for the first quarter of 2019 remained depressing. Compared to 2018, the new-car market was down 8.7%, from 95,844 to 87,531.

There was better news for producers of commercial vehicles. Bakkie sales rose 1.9% in March, medium trucks 6.2% and heavy trucks 5.3%. The end result was a 3.1% drop in total new-vehicle sales, from 49,230 to 47,718.

For the quarter, the aggregate market was down 4.8%, from 141,269 to 134,479.

It’s unlikely to improve soon. According to the National Association of Automobile Manufacturers of SA (Naamsa), prospects for domestic-new vehicle sales, particularly the new-car market, will continue to be affected by the depressed macro-economic environment and enduring pressure on household disposable income.

“Higher food, fuel and electricity prices, a weaker exchange rate against all major currencies and load-shedding continued to dampen already low levels of business and consumer confidence.”

On the other hand, it said the Reserve Bank’s decision not to increase interest rates, and the delay in ratings agency Moody’s latest SA assessment, were welcome “reprieves”. Consequently, “improved second-half sales are expected in anticipation of an improved economic growth rate for the year.”

The good news for local vehicle manufacturers is that industry production is growing, as export growth outweighs domestic decrease.

In March, SA new-vehicle exports leapt 23.7% from the corresponding 2018 month, from 30,161 to 37,296. That gave combined growth for the first quarter of 24.2%, from 71,819 to 89,221. If Naamsa’s forecasts are right, that will take industry new-vehicle production to a new record in 2019, just shy of 650,000. The current record, set in 2015, is 615,444.

Furlongerd@fm.co.za