{"id":698359,"date":"2023-06-24T17:00:00","date_gmt":"2023-06-24T15:00:00","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=698359"},"modified":"2023-06-24T13:18:13","modified_gmt":"2023-06-24T11:18:13","slug":"the-cheapest-cars-on-offer-by-luxury-brands-in-south-africa-and-how-much-they-cost","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/motoring\/698359\/the-cheapest-cars-on-offer-by-luxury-brands-in-south-africa-and-how-much-they-cost\/","title":{"rendered":"The cheapest cars on offer by luxury brands in South Africa – and how much they cost"},"content":{"rendered":"\n

New vehicle pricing has come into sharp focus over affordability concerns, with car prices becoming more and more expensive, and this is not hard to understand when you consider some of the cheapest entry-level cars offered by luxury brands now cost well over half a million rand.<\/p>\n\n\n\n

According to TransUnion\u2019s latest Vehicle Pricing Index (VPI), the price of new vehicles, on average, increased by 6.3% in Q1 2023.<\/strong><\/p>\n\n\n\n

While this is below the 7% inflation recorded over the same period, some body segments experienced steeper price increases.<\/p>\n\n\n\n

On average, the price of medium SUVs increased by 11.4% in Q1 2023, while the cost of Crossovers and small SUVs increased by 7.7% and 7.1%, respectively.<\/p>\n\n\n\n

Addressing the reasons for increases, several car manufacturers pointed fingers at the various challenges facing the manufacturing industry, including high inputs costs to load shedding, poor economic conditions, and shortages of key components as a result of global factors such as the shutdown of China\u2019s economy at the end of 2022. <\/p>\n\n\n\n

These issues also extend to luxury brands; however, some price increases have been notably significant.<\/p>\n\n\n\n

For example, the Mercedes-Benz A-Class retailed for R499,000 five years ago in 2018 and is now retailing with a starting price of R794,509. <\/p>\n\n\n\n

This represents a year-on-year increase of close to R60,000 or a 59% increase in price over the five years. <\/p>\n\n\n\n

Price may not matter<\/strong><\/p>\n\n\n\n

Despite the sharp increases in vehicle prices in South Africa, luxury brands such as Mercedes-Benz and the others on this list aren\u2019t targeting the affordability segment. <\/p>\n\n\n\n

Luxury cars have always symbolised status and success, which also holds true in South Africa.<\/p>\n\n\n\n

These cars are also known for their quality and performance. Luxury car brands are synonymous with high-quality materials, advanced technology, and superior craftsmanship.<\/p>\n\n\n\n

These factors can make owning a luxury car a more enjoyable driving experience. They are often perceived as more reliable and safer than the average car, employing rigorous safety standards in their manufacturing processes.<\/p>\n\n\n\n

These types of cars and brands offer those that can afford them a superior driving experience over the average vehicle. They, therefore, are more concerned with quality and brand reputation among the top earners in the country. <\/p>\n\n\n\n

However, it\u2019s always interesting to know the cheapest opinions among the top luxury brands in South Africa, so, BusinessTech looked at these models and how much they cost right now.<\/p>\n\n\n\n

The cheapest car on this list is the Audi A1, retailing at R463,800 off the showroom floor.<\/p>\n\n\n\n

Using Wesbank\u2019s vehicle finance calculator<\/a>, assuming no deposit and a 0% balloon payment over five years (60 months) at an interest rate of 11.75%, the estimated monthly repayment is R10,354 per month for the A1.<\/p>\n\n\n\n

Industry experts still recommend that prospective buyers spend no more than a quarter (25%) of their monthly income on vehicle-related costs.<\/p>\n\n\n\n

Considering this recommendation, the minimum monthly salary required to afford the Audi A1 is around R41,000.<\/p>\n\n\n\n

According to the latest World Inequality report, this equates to just under R500,000 per annum, putting those that can afford the cheapest vehicle on this list in the top 8% of income earners in the country.<\/a><\/p>\n\n\n\n

To put this in perspective, 92% of the population is poorer than those who can afford the A1, with the bottom 50% of working adults earning roughly R12,300 a year and the top 10% making more than 60 times that at around R780,300.<\/p>\n\n\n\n

Moreover, those who can afford the cheapest Ferrari \u2013 with a price tag of R6,804,200 \u2013 would have to earn roughly R585,500 per month, putting them firmly in the top 1% of income earners.<\/p>\n\n\n\n

The cheapest models on offer by South Africa\u2019s most popular luxury brands are listed below.<\/p>\n\n\n\n

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Alfa Romeo \u2013 Tonale<\/strong><\/p>\n\n\n\n