BMW Group cracks top 10! SA’s best-selling brands in June 2024
South Africa’s new-vehicle market suffered another substantial year-on-year decline in June 2024, sinking by 14%. Here’s your market overview, with the BMW Group cracking the top 10 of Mzansi’s most popular brands…
The downward slope continues. Yes, South Africa’s new-vehicle market – which has experienced year-on-year growth in just a single month so far this year – suffered a 14.0% decline in June 2024, with total sales falling to 40 072 units, year on year. Still, at least that figure represents an 8% improvement over May 2024‘s even more modest effort.
According to Naamsa, this latest subdued sales performance “underscored the constrained economic environment in the country, amplified by weak consumer and business demand”. The only positive news was that export sales recorded a marginal 3.6% year-on-year increase, improving to 28 306 units last month.
Out of the total reported industry sales in June, Naamsa estimated that 82.5% represented registrations via the dealer channel, while a considerable 11% were sales to the vehicle-rental industry, 3.6% to government and 2.9% to industry corporate fleets.
All of the major local segments suffered pronounced declines in June 2024. The new passenger-vehicle market, for instance, slipped 9.0% year on year to 26 928 units (with rental sales accounting for a hefty 14.2% of that figure). Likely compounded by the departure of the Nissan NP200 earlier this year, the light-commercial vehicle segment recorded a whopping 24.3% year-on-year loss to end the month on 13 937 units.
Meanwhile, WesBank suggested that affordability was the “biggest factor limiting growth” in the local market. New-vehicle prices had increased in the 1st quarter of 2024, with the vehicle- and asset finance house’s dataset thus showing hikes in both the average loan amount on a new vehicle and the average deal duration. “These are all signs of affordability challenges that either indicate that consumers are holding onto their existing vehicles for longer or that they are forced to lower instalments by extending the loan period,” says Lebo Gaoaketse, Head of Marketing and Communication at WesBank.
“Layer in the other inflationary costs of living to [the average] consumer and you can imagine the pressure on household budgets. Those with an option to delay a purchase decision or opt for alternative mobility solutions, including e-hailing, sharing or the pre-owned market, are voting with their feet and exiting the new-vehicle market.”
Brandon Cohen, Chairperson of the National Automobile Dealers’ Association (NADA), described June as “another unsettled month for South Africa”, suggesting the delayed announcement of the Government of National Unity’s Cabinet impacted local business confidence and consumer decision-making regarding major purchases.
“It is tough out there. The few green shoots we saw after the elections dried up due to the time it took to appoint the Cabinet. The taxi market is slowly starting to recover, as sales over the past few months dropped from around 1 400 per month to almost zero. This decline is due to banks being risk-averse in this sector.
“This cautious approach has extended across the industry, with approval rates remaining under pressure. Additionally, the trend of approved loans not being taken up by consumers has increased, reflecting a lack of confidence in the market,” Cohen explained.
New-vehicle sales summary for June 2024
- Aggregate new-vehicle sales of 40 072 units decreased by 14.0% (6 531 units) compared to June 2023.
- New passenger-vehicle sales of 26 928 units decreased by 9.0% (2 671 units) compared to June 2023.
- New light-commercial vehicle sales of 10 552 units decreased by 24.3% (3 385 units) compared to June 2023.
- Export sales of 28 306 units increased by 3.6% (977 units) compared to June 2023.
10 best-selling automakers in South Africa in June 2024
Another month, another market-leading sales performance from Toyota. Yes, the Japanese giant’s local division – which also counts sales from the Lexus and Hino brands – came just short of moving back into 5 figures, ending June 2024 on 9 743 units. For the record, that’s a month-on-month increase of 10.8%.
The Volkswagen Group – which includes Audi sales in its tally – held strong in 2nd place, finishing the month on 5 514 units (its 2nd best effort of 2024 thus far, after January 2024). Having snaffled the runner-up position in April before returning to 3rd in May, Suzuki again completed the podium in June, with 4 297 units.
Despite suffering a 15.9% month-on-month fall, Ford (2 404 units) retained 4th place ahead of Hyundai (2 367 units) in a likewise unchanged 5th spot. Similarly, Isuzu – although having grown registrations 32.7% month on month to 2 157 units – held onto 6th position. Interestingly, Nissan (1 905 units) managed to climb a ranking to 7th, pushing Chery (1 653 units) down a spot to 8th.
GWM (which includes Haval sales) remained in 9th place with 1 307 units, while the BMW Group (which includes Mini sales) returned to the top 10 for the first time in recent memory, ending June 2024 on 1 104 units. That saw Mahindra (1 060 units) take 11th place, while Renault (1 030 units) and Kia (956 units) had to settle for lowly 12th and 13th, respectively. Mercedes-Benz (with a Naamsa-estimated 602 units) and Stellantis (571 units) rounded out the top 15.
1. Toyota – 9 743 units
2. Volkswagen Group – 5 514 units
3. Suzuki – 4 297 units
4. Ford – 2 404 units
5. Hyundai – 2 367 units
6. Isuzu – 2 157 units
7. Nissan – 1 905 units
8. Chery – 1 653 units
9. GWM – 1 307 units
10. BMW Group – 1 104 units
Sales outlook in South Africa for 2nd half of 2024
So, what’s next for South Africa’s new-vehicle market? Well, Naamsa suggests households will continue to “grapple with consistent cost pressures in a weak economic environment, with affordability remaining a decisive factor in new-vehicle purchasing decisions”.
“Cumulative new-vehicle sales for the first 6 months of the year [are] now tracking 7.6% below the corresponding period [in] 2023, in line with industry expectations of a taxing 1st half of the year,” says the industry representative body.
“However, the markets seem to have responded positively to the announcement of the new [government] Cabinet and along with a 3rd month of no load-shedding, a further welcomed relief at the fuel pumps in July 2024 reducing inflationary pressure, and likely lower interest rates to commence before year-end, brighter economic prospects for the 2nd half of the year are steadily improving,” adds Naamsa.
Meanwhile, WesBank’s Gaoaketse points to the fact that year to date, new-vehicle sales in South Africa have declined 7.4% to 246 052 units, leaving a “possibility of the market failing to reach 500 000 units this year”.
“Vehicle-price inflation, high interest rates and the general rising costs of living are all impacting the ability of new-car buyers to enter or stay in the market. Until there is some relief in interest rates, greater incentive deals from manufacturers or a significant shift in general inflation or earnings, the new-vehicle market will continue to remain under pressure,” explains Gaoaketse.
NADA’s Cohen, meanwhile, says “there have been several positives of late which will help boost the economy”, though cautions “we will have to wait a while to gauge the effect of the new government”.
“These include more than 3 months of no load-shedding, with another 800 MW being added to the grid from the Kusile power station last week. Additionally, the rand has recovered against the dollar, now hovering between R17.90 and R18.20, compared to over R19 when the election results were announced. This recovery bodes well for inflation, which remains sticky and has needed good news in the market.”
“Dealers are the face of the industry and deal with the consumer directly, so we have a unique understanding of the financial pressures consumers are under and the issues they face. We do still have our ongoing longer-term battles like crime, corruption, as well as utility supply constraints, but all signs are pointing towards a brighter 2nd half of the year for consumers and dealers alike,” concludes Cohen.
Related content
Hilux vs Ranger: single-, extended- & double-cab sales