New vehicle sales expected to remain on an upward trend in 2023 – SSS
A total of 10,923 vehicle units were sold in Namibia last year, 15.9% higher than the 9,427 units sold in 2021, and exceeding the 10,415 units sold in 2019 according to an analysis from an investment research firm, Simonis Storm Securities (SSS) last week.
According to SSS, the annual sales were split 51% for passenger vehicles and 49% for commercial vehicles.
“This was despite Namibia being in an interest rate hiking cycle and high commodity prices and shipping costs, together with a weak Rand exchange rate, leading to an average of 5% increase in vehicle prices across different brands during 2022,” the research firm noted.
According to SSS, the improvement in vehicle sales correlates with positive growth rates recorded in the wholesale and retail sector throughout 2022, expanding by 0.8% year-on-year (y/y), 0.6% y/y, and 10.2% y/y in the first, second and third quarter of 2022 respectively.
“Consumption spending has been somewhat resilient last year, despite inflationary pressures and rising interest rates when comparing vehicle sales in 2022 to 2021. An improvement in vehicle sales also came about despite local dealerships battling with supply chain issues which have led to major backlogs in customer orders,” SSS added.
Going forward, SSS expects vehicle sales to remain on an upward trend in 2023, with the expectation that the supply of new vehicles from overseas factories should improve from mid-2023 onwards, together with continued momentum in spending from last year.
Commercial vehicles in particular could see improved sales figures owing to favorable mining and transport sector growth forecasts for 2023, as well as the construction of green hydrogen projects at the coast, the investment research firm said.
