WesBank has noted that January\u2019s new vehicle sales threw an analytical curve-ball due to the lack of BMW numbers as the manufacturer changes its reporting system.<\/p>\n
As a result, the headline market number of an 8.1% decline, to 39,475 units in the first month of 2020 is not entirely representative, it said.<\/p>\n
The question on industry\u2019s and consumers\u2019 minds will be whether January sales are indicative of 2020 market performance or whether the volatility experienced in 2019 will continue.<\/p>\n
“Taking BMW\u2019s monthly average sales during 2019 into account, a more representative January sales picture may be in the region of 5.2% down,” said Lebogang Gaoaketse, head of marketing and communication.<\/p>\n
“Nevertheless, January sales remained depressed.”<\/p>\n
WesBank indicates that the December-January relationship in sales results has varied over the years.<\/p>\n
“While consumers usually delay purchase decisions in December into the new year, boosting January sales as a result, January 2020 numbers are lower than December 2019, indicating a particularly slow start to sales in the new decade,” said Gaoaketse.<\/p>\n
Without taking the BMW anomaly into consideration, passenger car sales started the new year 5.1% slower than 2019, accounting for 28,116 sales. Reassuringly, dealer channel sales in the segment were just 1.6% down.<\/p>\n
The Light Commercial Vehicle (LCV) market didn\u2019t have anything to hide behind, however. The segment was 16.3% down on January 2019 to 9,791 units, the lender noted.<\/p>\n
Consumers and industry welcomed the surprise interest rate cut in January, but its effects on stimulating sales certainly didn\u2019t materialise during the month.<\/p>\n
“While many economists and commentators were hoping for an additional rate cut towards the end of last year, the 0.25% cut early in the new year will hopefully still contribute to a more optimistic tone for the industry this year,” said Gaoaketse.<\/p>\n
WesBank stressed that January sales are traditionally slower as the economy ramps up from the holiday season.<\/p>\n
“Reassuringly, we have seen a slow but constant shift towards new vehicle sales over the past 12 months, lowering the used:new car ratio in the WesBank book,” said Gaoaketse.<\/p>\n
“This bodes well for new vehicle industry sales during 2020, albeit under on-going strain.”<\/p>\n
As the nation awaits the budget speech during February, consumers will be expecting to come under further household budget pressures.<\/p>\n
\u201cThis is likely to have a knock-on effect through February sales and we should only expect a clearer picture at the end of the first quarter to fully understand what 2020 new vehicle sales are going to look like,\u201d said Gaoaketse.<\/p>\n