Although fuel hikes, inflation, and challenging economic conditions are the main factors sending car buyers to the second-hand vehicle market, the sheer number of options available is also becoming a big drawcard.<\/p>\n\n\n\n
TransUnion’s latest Vehicle Pricing Index (VPI) shows that used vehicle prices have experienced, on average, a more significant increase than new cars in South Africa, with the report recording a price increase of 8% in Q3 2023 (3% above inflation).<\/p>\n\n\n\n
Notably, the report showed that older cars (>three years old) showed an even more significant price increase \u2013 with prices rising between 15.7% and 19.4%.<\/p>\n\n\n\n
According to the report, the percentage of cars \u2013 both new and used \u2013 being financed below R200,000 declined to 19% in Q3 2023 from 20% in Q3 2022, likely due to the increased average purchase price of new vehicles, leaving little choice for prospective buyers in this price band.<\/p>\n\n\n\n
The data further found that 28% of vehicle financing deals were for cars between R200,000 and R300,000, and 53% shopped for cars over R300,000<\/strong>. <\/p>\n\n\n\n TransUnion noted that this is a result of rising vehicle prices, with consumers forced to spend more for a reliable vehicle, while those in the used vehicle market moved to older cars to meet their needs.<\/p>\n\n\n\n Experts have noted that as much as price is a significant driver of the pre-owned car market, South African motorists are now also enjoying the wide variety of quality vehicles offered. <\/p>\n\n\n\n “Gone were the days when pre-loved vehicle lots might have had a few fixer-uppers displayed in the back,” said Donovan Enslin, used vehicle manager for the Kelston Motor Group. <\/p>\n\n\n\n \u201cI don\u2019t think there is a manufacturer delivering a poor vehicle at the moment,\u201d he said. \u201cYou can now get a great vehicle for R150,000. Even at the lower end, you can be assured of a good vehicle, and the market is very diverse. \u201cYou are never limited in your choice.\u201d <\/p>\n\n\n\n The country\u2019s pre-owned sector has taken off amid higher fuel prices and a challenging economic environment<\/strong>. <\/p>\n\n\n\n Data from used-car platform AutoTrader shows that almost 100,000 more vehicles were listed for sale between January and June 2023 compared to the same period in 2020. <\/p>\n\n\n\n In the same timeframe, 18 new vehicle brands entered the market.<\/p>\n\n\n\n According to Enslin, in recent months, there has been a rise in demand for compact SUVs and crossovers<\/strong> that were better equipped to negotiate South Africa\u2019s notorious potholes. <\/p>\n\n\n\n \u201cThe moment you add ride height to a vehicle, you get a more comfortable drive. It\u2019s preferable to having a hatchback, which can struggle on our roads.\u201d <\/p>\n\n\n\n For this reason, the Chery Tiggo had become extremely popular, he said. <\/p>\n\n\n\n However, pre-owned Toyota Fortuners and Ford Rangers remained highly sought after \u2013 an insight that corresponds with AutoTrader figures for 2023, which indicates that the Japanese manufacturer takes up 15.3% of the listings, followed by VW (12.98%) and Ford (10.60%). <\/p>\n\n\n\n \u201cI deal in these vehicles, and if it\u2019s hard for me to choose from what\u2019s available, it\u2019s also going to be tough for a buyer. That\u2019s how much we\u2019re spoilt for choice<\/strong>,\u201d Enslin said. <\/p>\n\n\n\n
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