The National Association of Automobile Manufacturers of South Africa (Naamsa) warns that there is a likelihood of further near-term global supply chain disruptions to new vehicles in South Africa.
According to the association, supply disruptions may stem from the rapid re-opening of the Chinese economy, resulting in surging Covid-19 infections.
In late December, TopAuto reported that the world’s No.1 automaker Toyota said that its outlook for 2023 remains uncertain due to a persistent shortage of semiconductors and spikes in Covid cases in China.
Chip and other auto part shortages continue to plague the industry, and the rapid expansion of Covid cases throughout China will present additional difficulties, reported TopAuto.
Naamsa found that over the course of December 2022, Toyota remained the most in-demand car brand for South Africans despite its Durban factory suffering from severe flooding.
Over the last month of 2022, 11,250 units of Toyota vehicles were sold, followed by 5,331 Volkswagens and 3,058 Suzuki, reported Naamsa.
Looking back on domestic vehicle sales in 2022, Naamsa said that just as pandemic-induced disruptions seemed to subside in early 2022, the Russian invasion of Ukraine dealt a further blow to business and consumer confidence globally and in South Africa.
“The geopolitical conflict in Ukraine resulted in further supply chain disruptions and have inflated prices and the availability of strategic products and inputs.”
Naamsa did, however, note that despite the myriad of negative economic pressures and ongoing stock supply shortages, the new vehicle market continued to outperform expectations over the last year.
Positive growth in new vehicle market sales was also based on the consumer trend of South Africans buying less expensive and smaller cars, usually SUVs or crossovers.
In October of last year, the CEO of Right to Repair, Kate Elliot, added that the cost of living crisis is driving up the risk of poor road safety as consumers also opt for older cars but fail to maintain them.
According to Elliott, cash-strapped consumers frequently bring in their outdated vehicles for maintenance.
The cost of living crisis also shows no immediate signs of slowing, with high inflation and interest rates expected to hike once again.
In its latest brief on December 2022’s new vehicle sales statistics, Naamsa said that despite multiple national and international headwinds, the South African motor industry’s post-pandemic recovery continued, albeit at a slightly slower pace than in 2021.
“The new vehicle market registered its twelfth consecutive month of year-on-year growth during December 2022, with aggregate industry new vehicle sales at 41,783 units recording an increase of 5,839 vehicles or a gain of 16,2% compared to the total new vehicle sales of 35,944 units during the corresponding month of December 2021,” said Naamsa.
“The December 2022 new passenger car market and light commercial vehicle market reflected a sound performance with a year-on-year volume increase of 15,4% in the case of new passenger cars and a gain of 16,1% in the case of light commercial vehicles.”
Sales of medium commercial vehicles increased year-on-year by 36.9% while heavy commercial vehicles and buses increased by 23.1%, Naamsa added.
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