SA car sales | Volatile Rand leaves auto industry in a 'rollercoaster ride' - NADA

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• New vehicle sales showed an improvement in August after the challenges faced in July.

• More than 41 000 new vehicles were sold - an improvement of 24.6% over August 2020.

• NADA encourages buyers to be patient as South Africa struggles against the lingering effects of Covid-19.

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After analysing August 2021 sales figures distributed by Naamsa, the Automotive Business Council, South Africa's network of retail motor vehicle dealers again showed tremendous resilience in tough trading conditions, with numbers pointing to a much more resilient market, which is encouraging.

Overall sales were up to 41 425 units, which was a 24.6% improvement on the figure for August a year ago and a healthy 8 364 up on July 2021. The Retail dealer channel contributed a massive 83.6% of these sales - a testament to how vital franchise dealers are in the South African automotive ecosystem.

This was an outstanding performance as the economy is still recovering from the effects of the unrest in KwaZulu-Natal and Gauteng in July and the substantial disruptions at the ports as a result of the unrest, coupled with the cyber-attack on Transnet operations. We knew we had to deal with a loss of both business and consumer confidence and supply challenges, but still managed to deliver a strong recovery over the previous month. Year-to-date sales are up 32.4%, which is most encouraging.

Suzuki Swift
2021 Suzuki Swift

Other forces at play

There are other forces at play, too, with supply being the major one. The global shortage of semiconductors continues to wreak havoc with production, causing many factories to be idled. This shortage is likened to the Covid-19 pandemic in that it will not go away. In fact, the problem seems to be getting more severe as time goes by, with manufacturers either pausing production or deleting chip-specific functionality from certain model lines.

Then, here in South Africa, we are still encountering delays caused by the unrest and port disruptions, keeping customers waiting for their new vehicles. In some cases, they are tired of waiting and are changing brands by shopping elsewhere. Unfortunately, we will be forced to face this uncertainly for a while, and I don't think supply will stabilise for some time.

We also have to deal with a fluctuating Rand - down one day and up the next. It is volatile, and we believe this rollercoaster ride will continue in the coming months, with political uncertainty also playing a role.

What we, as NADA, believe is that it is most important to maintain Covid-19 risk mitigation protocols at our dealerships. We encourage South Africans to get vaccinated ahead of the predicted Fourth Wave to limit future economic fallout and unemployment, which are already at crisis proportions.

Mark Dommisse, Chairperson of the National Automobile Dealers' Association (NADA).

Mark Dommisse
Mark Dommisse
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