New vehicle sales in June come in 12.5% higher m/m
New vehicle sales during June 2022 came in 12.5% higher m/m, moving slightly higher than the 6-month moving average according to the National Association of Automobile Manufacturers of South Africa (NAAMSA).
The latest data shows that 866 new vehicles were sold during June 2022, compared to 770 units in May 2022 and 843 units in June 2021.
As usual, passenger and light commercial vehicles had the largest share of units sold in June 2022 with a 49.3% and 43.3% share of all units sold respectively.
In an analysis of the vehicle sales, Simonis Storm Securities (SSS) said the importation of both passenger and commercial vehicles has recorded lower annual growth rates YTD compared to the same period in 2021.
“Given that import levels edged lower in recent months, we expect shortages of both new and the quality second-hand cars to remain a constraint on vehicle sales in Namibia,” SSS added.
According to SSS, local demand still exceeds supply, despite the interest rate hiking cycle.
“This implies that vehicle prices are likely to continue on an upward trend (for both new and second-hand cars), raising official inflation rates going forward as the transport category is the third-largest in our consumer price basket used to calculate inflation,” the investment research firm added.
Meanwhile following the Ministry of Trade and Industrialisation announcement to allow the importation of vehicles not older than 12 years adjusted from the current 8-year age limit, SSS said the initiative attempts to address the vehicle shortage in the secondary market.
“While we commend the government for being creative and trying to address market shortages, we would not advise individuals to buy older cars. These cars would likely be at higher risk of having mechanical issues, which could prove more costly to own than a newer car with less mileage,” they added.