South African car sales have taken a bath – but there is hope

First published in the Daily Maverick 168 weekly newspaper.

Monthly sales reports from the National Association of Automobile Manufacturers of South Africa (Naamsa) have become a soothingly regular drip-feed of information in my inbox for more than 15 years. It’s the dipstick I use to measure the health of the industry and to suss out its trends.

Imagine my horror, therefore, when this year the monthly reports just stopped, to be replaced with a slick document sharing highlights and no detail. For example, the January report merely showed total sales by group, meaning I had no way of discerning whether Volkswagen Group had sold 2,000 Audi Q7s (a non-trivial development, you could say) or 2,000 Polo Vivos (par for the course).

I asked Naamsa why they have done this, and the automotive body’s CEO, Mike Mabasa, told me that they are making better use of their data and ensuring that the right data goes to the right people at the right time, in line with international best practice. Fair enough, I guess, but not much use for industry anoraks like me and Business Maverick’s readers, so I got the numbers anyway. I’ve been waiting for the February 2021 figures specifically, because they represent the first opportunity we have to take stock of the state of the industry after a year of the pandemic. February 2020 was the last sales month before lockdowns were implemented, and therefore sales in February 2021 give us a chance to take stock of volumes and trends a year into the pandemic.

As you might expect, it’s not exactly pretty. The pandemic has affected all manufacturers and importers differently, but the collective experience has been one of pain. The total vehicle market contracted by more than 13% in the year, driven by a slump in sales of passenger cars of more than 18%. This was offset to some extent by a small decline in light commercial sales (down 3% or so), and 10% growth in heavy truck sales. 

South Africa’s best-selling vehicle, the Toyota Hilux, actually grew sales year-on-year from 2,895 in February 2020 to 3,031 last month. Sales of Ford’s Ranger were almost flat (down from 1,878 to 1,858). This, and the strong sales of heavy trucks, is likely a manifestation of the boom in agriculture and mining the country is enjoying. This was also reflected in tractor sales in January, which grew 28% year-on-year according to Saama, as well as Sasol reporting last week that diesel consumption in SA had recovered to almost pre-pandemic levels. If ever there was a time to bless the rains down in Africa, this was it. 

However, as much as this offers relief for parts of the industry, the balance of payments and no doubt to SARS as well, the average South African motorist is clearly under pressure. An 18% slump in sales is one thing, but it’s particularly interesting to see what kind of cars people are buying.

Some of the numbers are just eye-watering. Ford Figo sales slumped 83% from 1,068 to 181, contributing to an overall decline of 55% in Ford’s passenger cars sales in the year. Toyota Yaris sales fell from 561 to three. Ford EcoSport sales fell from 997 to 577. Most tellingly, the gold standard barometer of the health of the South African motorist, sales of the VW Polo fell by 34% from 2,120 to 1,402, and the Fortuner, backbone of the South African family SUV market for more than 15 years now, fell from 975 to 706. Its competitor, the Ford Everest, struggled along (179 to 174).

The VW T-Cross.