The cars you can afford with your salary in South Africa right now

 ·3 Sep 2022

South Africa’s new vehicle sales are following the same trend as the year before, with August being the second-best performing month in terms of vehicle sales.

Vehicle financing firm Wesbank said that year-on-year comparisons are appearing to show consistency, and it is indicative of some type of stability returning to the domestic vehicle market.

According to the National Association of Automobile Manufacturers in South Africa (Naamsa), there were 47,420 new vehicle registrations in August.

“It is interesting to note the correlation in market performance this year against 2021,” said Lebogang Gaoaketse, head of marketing and communications at WesBank.

“Last year, August put in the second-best selling month at the time, March 2021 being the best sales month. Coincidentally, March 2022 sales have so far been this year’s best sales month.”

If it could be defined as a trend, the market prospects for the remainder of the year could hold further promise. August 2021 sales were usurped by September and then November volumes last year, said Wesbank.

In turn, more people could be purchasing cars despite more interest rate increases being inevitable this year.

“Applications for finance continue to show a growing demand for vehicle replacement, with WesBank’s book showing strong double-digit growth being driven by applications for new vehicles,” said Gaoketse.

When considering purchasing a new car, Kutlwano Mogatusi, WesBank Retail communications specialist, said that as a general rule, you shouldn’t spend more than 20% of your total income on car repayments.

Mogatusi said if you are making your purchase choices responsibly because it is what you can afford, rather than what you desire, you are making the best life choices.

“It is also important to budget for the other expenses that come with vehicle ownership such as fuel, insurance, maintenance and service costs – in addition to keeping up with all other financial commitments to maintain a positive credit history,” the lender said.

Here’s what you can afford

BusinessTech looked at what you can afford to buy on your monthly salary – based on the assumption that people are not spending more than 25% of their gross monthly income on vehicle financing.

The following calculations were completed using Wesbank’s repayment calculator and include the assumption of a 0% deposit for car financing. Additional fees which could be incurred during the inception of the loan are excluded from the calculation.

For purposes of these calculations, the cars are financed over five years (60 months) at an annual interest rate of 9%.

These calculations are purely for comparison purposes and are not meant as financial advice.

Price of car Monthly repayment Gross monthly salary required
R150 000 R3 208 R12 831
R200 000 R4 246 R16 982
R300 000 R6 322 R25 286
R500 000 R10 473 R41 892
R750 000 R15 663 R62 651
R1 000 000 R20 852 R83 409
R2 000 000 R41 611 R166 443
R5 000 000 R103 886 R415 543

Here is a list of cars you may currently purchase in South Africa at each of the indicated price points:

Between R16,000 – R25,000 per month:

Suzuki S-PressoR156,900

Kia Picanto X-Line – R198,995

Mahindra XUV300 R234,999

Toyota Urban Cruiser R274,900

Hyundai Grand i20 R290,900

Between R25,000 – R42,000 per month

Ford EcoSport R311,400

Volkswagen T-Cross R368,900

Volkswagen Taigo – R429,900

Between R42,000 – R83,500 per month

Mazda CX-5R515,400

Honda HR-V Executive CVT R554,500

BMW 2 Series Gran Coupé R665,000

VW Amarok R764,500

Around R83,500 or upwards per month

BMW X3R932,500

Mercedes EQA – R1,169,500

Audi RS3 Sportback R1,215,000

E-tron GT Quattro – R2,715,000

Mercedes EQS R2,615,100

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