New vehicle sales pick up as tourism peak season hits
New vehicle sales increased by 23.5% to 1 134 units at the end of June 2018, an increase attributed to the tourism peak season that started from May and ends in October.
In May 2018, a total of 918 new vehicles were sold. Meanwhile, the June increase was as a result of an increase in all categories with an exception of buses and heavy commercial vehicles that remained mute.
Analysts from Simonis Storms Securities said that the June 2018 increase was seasonal, adding that they do not expect excessive increase in new vehicle sales in the coming month.
Furthermore, despite this monthly increase, new vehicle sales declined by 5.4% on a yearly basis. The annual decline can be attributed to negative growth in extra heavy and passenger vehicles by 41.6% and 11.1%, respectively.
“In our view, the demand for extra heavy vehicles will remain low over the medium term as construction activities remains gradual,” said Indileni Nanghonga, analyst at Simonis Storms Securities.
Moreover, vehicles channelled through rentals have increased by 774% monthly to 236 units in June 2018. This increase has been seen historically during this period with the Toyota brand increasing market share to 54% in June compared to 45% in May 2018. The firm expects total vehicle sales to decline by 12.8% to 11 605 units for the year.