“New car sales for May 2015 continue to show a decline of 3.2% year on year, mainly driven by passenger vehicles. An increasing number of buyers continue to seek and find value in the used car market which continues to grow”.
General Comments on May 2015 NAAMSA sales:
- The month of May 2015 shows an improvement in sales of 7.6% compared to April 2015.
- Month on month passenger vehicles increased by 17.4%, May 2015 compared to April 2015.
- Year on Year monthly comparison shows a decline in sales of 3.2% in May 2015 compared to May 2014.
- Passenger vehicles declined by 5.4% in May 2015 compared to the same month last year.
- Year on year monthly comparison shows an improvement in exports of 41.6% in May 2015 compared to May 2014.
- Passenger vehicles for exports improved by 201.30% in May 2015 compared to the corresponding month last year.
General Comments on May 2015 Standard Bank VAF Personal New Business:
- May 2015 compared to the corresponding month last year, new vehicles improved by 48.4% year on year while used vehicles increased by 72.3% year on year.
- Month on month, used vehicles improved by 4.7% while new vehicles declined by 6.1% (May 2015 compared to April 2015).
- There are slightly less passenger vehicles sold this month compared to the same month last year (90.3% compared to 90.8%). There are fewer light commercial vehicles sold this month compared to the same period last year (8.4% compared to 8.9%).
- The average contract term increased from 65.2 months in May 2014 to 68.7 months in May 2015 (5.4% year on year growth).
- The average deal size increased from R285 785 in May 2014 to R293 202 in May 2015, 2.6% year on year increase.
General Macro and Industry Comments:
- CPI annual inflation rate in April 2015 was 4.5%. This rate was 0.5 of a percentage point higher than the corresponding annual rate of 4.0% in March 2015. On average, prices increased by 0.9% between March 2015 and April 2015.
- The SARB expects inflation to average 4.9% in 2015, with a first quarter low of 4.1%.
- Real gross domestic product at market prices increased by 1.3% quarter on quarter, seasonally adjusted and annualised. The SARB has revised their forecasts down to 2.1% in 2015 from 2.2% in March and 2.2% in 2016 from 2.3% in March.
- The transport index increased by 4.5% between March 2015 and April 2015, mainly due to a 156c/litre increase in the price of petrol. The annual rate increased to -1.1% in April 2015 from -5.0% in March.
- The repo rate was left unchanged at 5.75% at the recent monetary policy committee meeting in May, in line with the industry’s expectations. The rate was last changed in July last year.
- According to the SARB, consumption expenditure by households is expected to remain relatively subdued, as higher personal tax rates take effect and the benefits of lower petrol price dissipate.
- The Department of Energy announced that the price of petrol for June 2015 will increase by 47 cents for all grades effective 3 June 2015. The price of diesel will increase by between 46 and 49 cents.
- According to the DOE the main reason contributing to the price adjustments is the high crude oil prices which resulted in higher prices (on average) for all the petroleum products in the international markets in May 2015 compared to April 2015.
Comments on NAAMSA New Vehicle Sales Report – May 2015
Nicholas Nkosi – Head of Standard Bank Vehicle and Asset Finance – Personal Markets