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How strikes affected vehicle sales

Johannesburg - The automotive industry strike affected vehicle export numbers, which recorded a year-on-year monthly decline of 75.1% in September but reflected some recovery in October, Naamsa said on Friday.

"Industry new vehicle exports during October, 2013, at 21 125 vehicles, registered a substantial decline of 3767 units or a fall of 15.1 percent compared to the 24,892 vehicles exported in October last year," the National Association of Automobile Manufacturers' of SA (Naamsa) said.

"This was largely due to the auto sector strike, with exports of light commercial vehicles, in particular, being adversely affected."

As a result, the original 2013 industry projection of vehicle exports of 336,000 units would likely be revised downwards to about 290 000 units for the year.

Naamsa said the October export figures recovered as manufacturers resumed "normalised vehicle production" mid-month.

For October, overall domestic sales declined by 2.9% in volume terms compared to October last year.

The momentum of vehicle exports was expected to improve in 2014 as export programmes were ramped up, and particularly exports of light commercial vehicles were expected to increase substantially in the new year.

"After four years of growth in the domestic market, aggregate new vehicle sales continued to show lower growth momentum in recent months," said Naamsa.

"In the event, year to date domestic sales showed an improvement of 3.9% compared to the corresponding 10 months of 2012."

Aggregate industry sales of 56,927 units for October this year reflected a decline of 2.9%, or 1704 vehicles, from the 58 631 units sold in October last year.

Out of the total reported sales, 80.1 percent were dealer sales, 12.9% were vehicle rental industry sales, 3.8% were industry corporate fleets and 3.2% government sales.

A total of 40 102 new cars were sold in October this year, which represented a decline of 4.4% or a total of 1860 units compared to the 41 962 cars sold in October last year.

Domestic sales of industry new light commercial vehicles, bakkies and minibuses reflected a marginal improvement of 0.2% to 14 125 units.

Medium and heavy truck vehicle sales of the industry also showed a slight increase.

"Domestically, expectations of lower economic growth and above-inflation new vehicle price increases would contribute to a more difficult trading environment and further moderation in sales growth momentum," said Naamsa.

"Despite a less promising outlook for the automotive sector, the year as a whole would still represent the second or third best year on record in terms of domestic sales."

Naamsa said the low interest rate environment should lend some support to the domestic market together with the replacement demand, the highly competitive trading environment, attractive incentives and high technology model introductions.

Export sales would remain a function of the performance and direction of global markets, Naamsa said.


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