New vehicle sales in May experienced a buoyant 22% surge to more than 45 000 units, according to the latest sales data from naamsa | The Automotive Business Council.
“It was most satisfying to see customer confidence, boosted by a further interest cut and positive developments on the geopolitical front, translate into a 22% improvement in retail new vehicle sales in May,” says Brandon Cohen, national chairperson of the National Automobile Dealers’ Association of South Africa (NADA). “Sales were relatively slow during the first half of May, but increased significantly in the latter half of the month following president Ramaphosa’s meeting with US president Donald Trump, the finalisation of the national budget, and the interest rate announcement.”
Cohen notes that the substantial rise in overall sales was primarily driven by a 30% increase in passenger car sales, with 31 741 units retailed.
“In fact, actual market activity may have even been stronger than the reported total of 45 308 vehicles sold in May as only 12 of the 24 Chinese brands currently available in South Africa submitted sales data,” Cohen says.
Retail dealer channels performed particularly well, accounting for 88,4% of total vehicle sales in May. In contrast, rental companies made up a much lower-than-usual 6,8%, industry corporate fleets 3%, and government purchases just 1,8%.
Cohen says that the commercial vehicle sector performed exceptionally well in May, potentially signalling a renewed sense of confidence in the broader economy.
The used vehicle market also delivered some noteworthy trends, according to Thembinkosi Pantsi, vice-chairperson of NADA.
“May was a fascinating month for the pre-owned segment of the retail motor business,” says Pantsi. “Many customers opted for pre-owned models from aspirational brands instead of investing in new vehicles. This trend has been gaining traction in recent months, with some buyers even expressing interest in premium brand cars that are between seven and 10 years old.
“We’ve also observed some customers choosing pre-owned Chinese models rather than new ones, indicating a desire to test the reliability and aftersales support of these vehicles before committing to a new purchase.”
Pantsi adds that there was a noticeable uptick in foot traffic: “We saw an increase in ‘walk-ins’ during May compared to previous months. Many of these customers had already conducted research on online platforms and arrived well-informed.
“Overall, May was a very positive trading month,” Pantsi says.