By Jeff Osborne...
In a tough year for the economy, the strength of the previously owned car market has been the most significant story in the local automotive industry in 2017.
New car sales are showing some nascent signs of picking up but they have been trading below inflation for the first time in many years while there has been a marked increase in the price of used cars for sale.
The previously owned market has maintained a volume of more than twice the size of the new vehicle market this year. We continue to observe this trend on Gumtree, with approximately 75 000 listings of cars for sale at any given time. “Toyota Tazz” was the single most searched for Gumtree item of the year – another signal that demand for cheap cars remains high.
Aside from a concerning inability to reduce the shocking death toll on South African roads, the big news stories for the auto industry in 2017 were:
- GM’s withdrawal from South Africa taking Chevrolet with it but Opel remained
- Chinese company BAIC’s reported R11bn investment in a manufacturing plant in Port Elizabeth
- The relatively quiet arrivals on the local market of BAIC vehicles and another Chinese SUV brand Haval
- The Ford Kuga recalls
- The new AARTO bill that might include a demerit system
- The proposed New Code of Conduct, which seeks to provide consumers with the right to choose independent workshops and alternative parts without voiding their warranties.
The big global auto industry issues in 2017 were the growth in electric-powered vehicles, driverless cars and the impact on sales of the continued rise of ride-sharing apps like Uber. Inevitably, we’re lagging some way behind on those issues but they will impact significantly on the local market at some point in the near future.