Naspers dumps OLX used-car business

Naspers and its e-commerce subsidiary Prosus have alerted shareholders to their plans to exit OLX’s car classifieds business OLX Autos.

The group said that it is “exploring all options” related to the business, which it says is “no longer the right approach for Prosus and its shareholders”.

Naspers said that OLX Autos has been affected by ongoing market challenges, which include the higher cost of capital, high inflation and the reversal of pandemic trends.

This has led to a persistent slowdown in the second-hand car market, it said.

“While OLX Autos has built leading positions across many of its key markets as a result of its strong technology platforms and local focus, pursuing a global growth strategy, is no longer
the right approach for Prosus and its shareholders.

“Prosus will explore all options for the OLX Autos business, acknowledging that significant value exists within local markets,” it said.

Naspers said that the core classifieds business of OLX Group is continuing to deliver a strong performance through the financial year with improving profitability, and added that is well-placed for
further growth and margin expansion.

“Beyond OLX Autos, the core classifieds businesses in OLX are profitable, cash flow positive, and fast-growing. The exit of OLX Autos will lead to a significant improvement in the
profitability profile of the Classifieds segment as a whole,” it said.

While the OLX business may be doing well, this is outside the South African market. Naspers shut down OLX South Africa in February 2022.

The group still owns and operates another local auto classifieds business, AutoTrader.

Read: Good news for anyone looking to buy a used car in South Africa