New vehicle sales above pre-pandemic level

The last two quarters for new vehicle sales came in above the pre-pandemic level of the second quarter (2Q) of 2019, signalling a recovery from the pandemic, Simonis Storm (SS) said.With tourism picking up, purchases by rental companies have supported vehicle sales leading to 2Q2023 being the best performing quarter since 2Q2017. “Using 2Q2019 as the pre-pandemic level, 2Q2023 outperformed our benchmark by 11.6%. This is a positive indication that growth in this sector will support business activity in the transport, wholesale and retail sectors of our economy,” Simonis Storm pointed out.The number of vehicle sales increased by 51.4% year-on-year, from 872 units in June 2022 to 1 320 in June 2023. In prior months, sales were declining since March 2023, with June’s sales being the first monthly increase in sales since then. Light commercial vehicles drove sales in June 2023, increasing by 74.7% year-on-year – from a low base of 375 units to 657 units.At the same time, passenger vehicles accounted for 44% of sales and grew in sales by 34.3% year-on-year in June 2023. Smaller segments of the market – medium to extra-heavy commercial vehicles and buses – collectively account for 6.3% of total sales in June 2023. The transport and storage industry expanded by 6.7% year-on-year in 1Q2023. One of the contributors included freight services, which grew by 3.2% year-on-year, despite medium to extra-heavy vehicles showing a decline in sales units (3.5% year-on-year) during the same quarter. CargoAlthough units sold are below last year’s levels, commercial vehicle sales have been on an inclining trend since the start of the year. “This means that the volumes of cargo being transported have increased, as we expected at the start of the year based on our engagements with local trucking companies,” Simonis Storm said.Transport has consistently been 3% of gross domestic product (GDP) since 1Q2019, relatively low compared to other sectors in the economy. “However, we perceive transport to be a driver of economic activity in 2023, supporting complementary activities such as retail, mining, tourism and agriculture,” SS added.In growth terms, the wholesale and retail sector has surpassed pre-pandemic levels but not in real value terms. However, the wholesale and retail sector grew by 5.7% year-on-year in 1Q2023. At the same time, total vehicle sales grew by 18.5% year-on-year during the same period. Most local dealerships are positive on sales going forward – seeing high demand in passenger and commercial vehicles – and this should be supportive of further growth in the retail sector.The operation of vehicles category in our consumer price basket is showing signs of deflation, whereas car price inflation remains relatively flat. Vehicle price inflation averages 6.4% year to date. The operation of personal transport equipment inflation reached -2.5% year-on-year and fuel inflation -7.0% year-on-year in June 2023. “From our discussions with local dealerships, car prices will increase between 3% and 5% each quarter for the rest of 2023 across different brands,” SS said.

New vehicle sales above pre-pandemic level

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Republikein 2025-04-11

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New vehicle sales above pre-pandemic level

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