Vehicle sales increase 13.5% month-on-month

Vehicle sales have increased 13.5% month-on-month, largely driven by the sale of commercial vehicles. This is according to local stock broking firm Simonis Storm Securities (SSS) which released its monthly report this week.

Commenting on the report, Daniel Kavishe, economist at SSS said, “Monthly vehicle sales increased from 1716 units to 1947 units in February. The 13.5% jump in sales can be attributed to the sharp increase in sales of light commercial vehicles. Annualized growth figures for total vehicles sales remain positive at 12.7% despite the declining trend in the growth rate as compared to the same period last year.” According to the estimated values of imports during the final half of 2014, our data shows that the proportion of new vehicle sales has steadily risen over past year. Currently we estimate that vehicle sales account for 14% of our imports.  “Light commercial vehicle sales currently account for 52.5% of vehicle sales. Sales in this category increased by 15.5% month-on-month mainly as a result of increased sales in the Ford category. On an annual basis, sales in this category reflect an 11.0% jump mainly on the back of companies restocking their vehicle fleets as is common during the first quarter of the year,” he said. “The 25 basis points rise in interest rates during February’s monetary policy committee is yet to have an impact on vehicle sales. Currently the numbers reflect sales that are well above last year’s monthly average of 1809 units. We do anticipate a slower growth rate in vehicle sales as the impact of higher interest rates and lower spending by government on vehicles seeps into the numbers,” Kavishe added.