New Vehicle Sales Drop By 11 Percent in August

THE National Association of Automobile Manufacturers of South Africa’s (NAAMSA) figures for new vehicle sales in Namibia for August, show a 11% decrease.

Figures for August indicate that monthly vehicle sales decreased to 1694 from a record 1919 units in July.

“The 11,7 % decrease in sales month on month was a result of a major decrease in light commercial vehicles. Annualised growth figures remain positive as well at 15,6% with total commercial vehicles increasing by 7,6% year on year,” said Daniel Kavishe, an economist at Simonis Storm Securities.

He said the growth of sales within the market remains positive but a downward trajectory has started in comparison to last year’s sales during this period.

Kavishe said the numbers are mainly a reflection of a 26,6% drop in light commercial vehicles as businesses purchased less vehicles during the intervening period.

Interest rates are expected to increase before the end of the year by another 25 basis points as Bank of Namibia tries to manage the rate at which the foreign reserves are declining.

“We have experienced two interest rate hikes of 25 bps this year and one more is anticipated. The next interest rate hike will be prompted by monetary policy action in South Africa, which will result in higher interest rates in that economy as the reserve bank attempts to manage their currency,” he said.

According to NAAMSA, passenger vehicles were the most sold during the month under review recording 809 units. Light commercial vehicles followed suit with sales recorded at 777 units.

The most popular passenger vehicles also happen to be the two most affordable, Toyota Etios 84 units sold and Toyota Corolla 51 units sold.

Luxury vehicle maker BMW had a splendid month with 24 units of their 3 series vehicles being sold.

The most expensive car sold over the past month was the Mercedes GL class valued at about N$1,8 million.

“The value of total vehicles sold during the past month is approximately N$600 million. This further confirms our convictions that Bank of Namibia will have to raise rates as foreign reserves continue their downward spiral,” Kavishe said.

Source : The Namibian