Sales for the rest of the commercial vehicle segment grew 5.5%, year-on-year, driven by strong demand for extra-heavy commercial vehicles. Sales into the rental channel declined 20.9%, year-on-year. This was heavily influenced by a sharp decline in tourism, as well as aggressive competition from disruptive players in this sector.
“Although interest rates remained unchanged last month, many factors contributed to the decline in sales,” said Simphiwe Nghona, CEO of WesBank’s motor division.
“We had two fewer working days, continued depreciation of the rand and a general negative sentiment among both consumers and businesses.”
Despite the decline in sales, WesBank’s data shows demand for vehicle finance was at an all-time high. A record number of vehicle finance applications were received, with total application volumes growing 6.7%, year-on-year. Used vehicle application volumes grew 2.4%, while demand for new vehicle finance was up 15.6%. This healthy demand for new vehicle finance is attributed to an end-of-quarter sales drive, with manufacturers offering consumers attractive incentives.
However, high levels of household debt and deteriorating credit profiles have impacted consumers’ ability to afford new debt.
“The declining new vehicle sales market is responsible for hyper competition between vehicle manufacturers, leading to very aggressive marketing activity – to the benefit of consumers,” said Nghona.