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Sales growth slow amidst economic pressure
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Exports expected to increase in Q2 of 2014
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Toyota expects further volume growth from new model introductions in next quarter
|
Market segment |
March 2013 |
March 2014 |
% change |
|
Passenger vehicles |
37 612 |
36 798 |
-2.2% |
|
Light commercial vehicles |
15 289 |
15 848 |
+3.7% |
|
Medium commercial vehicles |
1 008 |
1 005 |
-0.3% |
|
Heavy commercial vehicles |
394 |
487 |
+23.6% |
|
Extra Heavy commercial vehicles |
1 036 |
1 263 |
+21.9% |
|
Bus |
111 |
102 |
-8.1% |
|
Vehicle exports |
27 782 |
24 665 |
-11.2% |
|
Overall market (local) |
55 450 |
55 503 |
+0.1% |
Demand for the new Toyota Corolla and a strong sales performance by favourites such as the Toyota Hilux, Fortuner, Ses’fikile taxi and Etios drove Toyota South Africa Motors’ market share up amidst stagnant sales in March.
Toyota sold 11 688 units in March to record a 21.2% market share in a market of 55 363 units. This is a gain of 1.7% in overall market share in the past month.
“We are very excited about the market reception for the new Toyota Corolla, which we produce in Durban for the local and international markets and which went on sale in March,” says Calvyn Hamman, Senior Vice President for Sales and Marketing at Toyota South Africa Motors.
“The new Corolla represents an investment of over R1 billion in our South African operations and should boost our export programme in 2014,” says Hamman.
Full scale exports of the new Corolla started in March and supported Toyota’s position as South Africa’s largest manufacturing exporter, with 7 911 locally manufactured vehicles shipped across the world.
On local soil vehicle sales remained relatively flat, with the only noticeable decline registering in the passenger vehicle market, which declined by 338 units or 2.2% compared to the same month last year.
An overview of the first quarter sales shows that the market declined by 3.3% to 160 278 units sold, while vehicle exports declined by 16.3% to 60 449 units for the first quarter.
“Vehicle sales are holding up relatively well, considering the negative impact of a 0.5% rate hike, vehicle price increases in the wake of a weakening rand and the general pressure on disposable income,” says Hamman.
“At the same time one should not be too alarmed by the performance of local and export sales in the first quarter, as several manufacturers only recovered in March from the impact of last year’s seven week strike, while others, such as Toyota, changed over to new models, which influenced sales during the transition period,” says Hamman.
The Toyota Hilux remains South Africa bestselling vehicle for March as well as in the year to date. There is a trend towards smaller more fuel efficient engines in commercial vehicles. The buying down trend continues in passenger vehicles, as consumers are looking for fuel efficiency and more powerful small engines in passenger cars.
Hamman says a study of general repayment terms shows that the average private vehicle buyer is feeling the pinch of the increase in living costs and is trying to contain that by lengthening repayment periods and/or opting for a “balloon” payment at the end of the repayment period. This means that many private buyers are more susceptible to any further increases in inflation and interest rates.
“With a general expectation of further interest rate hikes and the possibility of more vehicle price increases later in the year we hold firm to our forecast of a slight decline in vehicle sales for the year. As new vehicle price increases are coming through, it will positively impact on used car volumes due to the price gap widening between used and new vehicles.
“We do however expect a further boost to our sales as we prepare for the introduction of another locally produced volume seller, which we will announce in this quarter,” says Hamman.
