Volkswagen predicts market growth in 20102nd February 2010
During January 2010 a total of 27 008 new passenger cars were sold in South Africa. Total new passenger car sales in January, including sales not reported in detail to NAAMSA, increased by 41 percent when compared to December 2009, and by 20.1 percent when compared to January 2009.
“An analysis of the seasonal pattern of demand for new passenger cars reveals January is usually above average and in comparison to December, can be expected to yield an increment of some sixteen to eighteen percent. The market in January, however, has come in substantially above expectations reflecting a larger than normal carry-over of new car sales into the new year,” commented Mike Glendinning, Director of Sales and Marketing, Volkswagen of South Africa.
“However, the new car sales cycle continued its upward momentum in January after having reached a lower turning point in June last year. The real rate of growth in the sales cycle will only be determined in coming months after the distortions of the December and January period have been accounted for in the analysis,” continued Glendinning.
“Looking ahead, the relative strength of the exchange rate, while pressurising exporters and import competitors, will promote lower levels of inflation which in turn suggests that interest rates will probably remain at current levels for the foreseeable future. Real household income will also begin a slow recovery, supporting the demand side of the economy, including the demand for new vehicles. Encouragingly, both business and consumer confidence reflected some improvement during the last quarter of 2009 and continued robust levels of fiscal expenditure will also support the economy during 2010.”
“In these circumstances, it is likely that the new car sales cycle will reflect slow but steady growth through the coming year, a trend that will probably be further supported by the impact of the Soccer World Cup in mid-year 2010,” concluded Glendinning.