March 2011 turned out to be another strong month for new vehicle sales both domestically and for exports. Sales in SA rose to 53 478 units while exports were a record 29 254. On a seasonally adjusted basis, domestic sales kept up with sales in February 2011 and the industry remains on track to sustain sales of new vehicles at a monthly rate of around 50 000. Seasonal adjustments are always complicated by Easter holiday influences in March and April and so a still clearer picture will have to wait until April sales volumes are released.
To view the graphs and tables referred to in the article, see Daily Ideas in todays Daily View: Daily View 5 April: Vehicle sales: Shifting into overdrive
The underlying growth in new vehicle sales appears to have reached something of a peak at about the 23% year on year rate of growth. Growth rates in vehicles can be expected to slow down as the year on year comparisons become more demanding. Growth rates in new vehicles sales are now approximating the pace realised at the end of the previous boom in 2006-07.
It is of interest to note that sales of heavy trucks and buses in March 2011 were up by 298 units or 21.4% on a year before. Thus it is not only households that are adding to their stock of new vehicles, but firms are doing so too. This indicates a recovering appetite for fixed investment spending in SA that to date has been the weakest component of domestic spending. The banks, short of mortgage business, have clearly welcomed the opportunity to provide credit for vehicle purchases; though no doubt the balance sheets of the motor manufacturers have also been put to work facilitating sales. Brian Kantor