Government Demand Leads Car Sales to 19-Year High

GOVERNMENT demand pushed car sales to reach a 19-year high with 1 918 new vehicles sold in July.

IJG Securities said yesterday that the highest vehicle sales figure recorded in its 19 year history, reflecting an increase of 1,8% month on month off an already high base.

“The higher monthly figures were caused by an uptick in commercial vehicle sales, despite passenger vehicle sales slightly falling. As expected, July sales continued increasing after the seasonal slowdown in April-May, and the monthly figures expanded to beat the previous record sales level as set in June,” IJG said in a report.

On an annual basis, growth accelerated to 31,1%, falling from 44,9% year on year in June on account of base effects. At this point, 12 196 vehicles have been sold so far in 2014, up 46,9% on the comparable period of 2013.

The 12-month cumulative measure increased further to 19 154 and is now 40,5% higher than a year ago and up 2,4% from the previous month.

The increase in the 12-month cumulative figure is a combination of a low base and g results in the current period.

Sales of passenger vehicles slightly decreased, falling by 0,8% month on month to 821 vehicles sold.

Passenger vehicle sales are 21,8% higher than a year ago. Commercial vehicle sales increased 3,9% month on month to a record 1 097 vehicles sold,on account of higher numbers recorded in the light and medium categories.

Toyota and Volkswagen dominated the passenger market, selling the most vehicles in July, with the two brands claiming 32,9% and 17,8% of sales respectively. Toyota once again was the market leader in light commercial vehicles, having the lion’s share of sales at 49,4% of the market, followed by Nissan at 13%.

“The g increase in vehicle sales is attributed to a number of factors, namely the on-going expansive fiscal and monetary positions of the Ministry of Finance and Bank of Namibia, as well as purchase of vehicles by the government,” the report said.

The Ministry of Finance has allocated N$984,5 million to vehicle purchases in the 201415 National Budget, a N$517,8 million (111.0%) increase on the vehicle expenditure budget of the 201314 financial year.

“We expect the g growth trend to continue, however sales may slow towards the end of the year as monetary policy tightening is likely to continue. Nevertheless, government tenders yet to be delivered will maintain the momentum of vehicle sales through 2014,” IJG said.

Source : The Namibian