Author Archives: IJGResearch

New Vehicle Sales – April 2023

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A total of 1,004 new vehicles were sold in April, down 18.11% m/m from the 1,226 vehicles sold in March, but 11.6% more than in April 2022. Year-to-date, 4,138 new vehicles have been sold, of which 2,074 were passenger vehicles, 1,836 light commercial vehicles, and 228 medium- and heavy commercial vehicles. On a 12-month cumulative basis, a total of 11,516 new vehicles have been sold at the end of April, representing an increase of 18.6% y/y from the 9,712 sold over the comparable period a year ago.

April saw 468 new passenger vehicles sold in total, an 18.6% m/m decline, but marginally higher (1.5%) than in the same month a year ago. Year-to-date, new passenger vehicle sales grew to 2,074, an increase of 13.0% compared to the 1,836 vehicles sold over the same period in 2022. On a 12-month cumulative basis, new passenger vehicle sales increased to 5,812, up 20.3% y/y from the 4,831 vehicles sold over the corresponding period a year earlier.

536 new commercial vehicle units were sold in April, representing a 17.7% m/m drop from the 651 units sold in March, but 22.1% more than in April 2022. Light commercial vehicles accounted for 473 of the total commercial vehicles sales in April, medium commercial vehicles sales came in at 17 units, and heavy and extra heavy commercial vehicles sales amounted to 46 units. All three categories witnessed fewer sales in April than in March. On an annual basis, light commercial vehicles sales grew by 20.7% y/y, heavy and extra heavy commercial vehicles sales increased by 53.3% y/y while sales in the medium commercial vehicle category remained steady. Year-to-date, 2,064 commercial vehicles have been sold, of which 1,836 were light commercial vehicles, 77 medium commercial vehicles and 151 heavy and extra heavy commercial vehicles. On a twelve-month cumulative basis, light commercial vehicle sales increased by 20.0% y/y to 4,983 units, medium commercial vehicle sales rose by 23.7% y/y to 235 units while heavy commercial vehicle sales came in at 486 units, representing a contraction of 9.7% y/y.

Toyota continues to show its dominance in the new passenger vehicle sales segment, after taking 38.0% of the market share year-to-date, followed by Volkswagen with 22.4% of the sales year-to-date. Kia and Haval are the best of the rest with 8.3% and 5.1% of the market share, respectively.

Toyota also asserted its dominance in the light commercial vehicle segment after claiming 53.4% of the sales year-to-date. Ford trailed in second place, taking up 12.6% of the market share. Mercedes continues to lead the medium commercial vehicle segment with 31.2% of the market share, while Scania remains on top in the heavy- and extra heavy commercial segment with 29.8% of the market share.

The Bottom Line  

Demand for new vehicles remained relatively strong in April with the 1,004 new vehicles sold being the highest number of units sold in the month of April since 2016. The drop in April’s sales figure from the recent high of last month was somewhat expected as data from recent years suggest a tapering in monthly vehicle sales after peaking in March of each year. The 12-month new vehicle sales cumulative figure has climbed to its highest levels since May 2019 with annual growth in the 12-month cumulative sales showing signs of slowing as the graph above depicts. On a year-to-date basis, vehicle sales continue to trend just above 2018 levels.

NCPI April 2023

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Namibia’s annual inflation rate softened to 6.1% y/y in April. On a month-on-month basis, prices in the overall NCPI basket rose by 0.4% m/m, following the 0.6% m/m increase in March. On an annual basis, overall prices in three of the twelve basket categories rose at a quicker rate in April than in March, eight categories recorded slower rates of inflation while inflation in the education category remained steady over the period. Inflation on services ticked up to 3.2% y/y while inflation on goods edged lower to 8.2% y/y.

Inflation Attribution

The Food and Non-Alcoholic beverages basket item was once again the largest contributor to Namibia’s annual inflation rate, contributing 2.5 percentage points in April. Prices of this basket item increased by 0.5% m/m and 13.5% y/y. The year-on-year inflation rates for most of the sub-categories in this basket category slowed from March but remain relatively elevated. Fruits posted the highest year-on-year inflation followed by Breads and Cereals. Fruit prices increased by 1.2% m/m and 28.5% y/y, marginally slower than the 29.1% y/y increase recorded a month earlier. Prices of the Breads and Cereals sub-category fell by 0.1% m/m but remain high considering that prices of this sub-category are 19.8% higher than they were a year ago. Vegetables and Fish were the only sub-categories which recorded quicker inflation compared to March on a year-on-year basis. Prices of the Vegetables sub-category rose by 2.5% m/m and 15.2% y/y, while prices of the Fish sub-category increased by 0.5% m/m and 8.8% y/y.

The Alcohol and Tobacco basket item was the second largest contributor to April’s inflation print, contributing 0.9 percentage points. Prices in this category rose by 0.6% m/m and 6.7% y/y. Inflation on alcohol products came in at 7.6% y/y, a slight uptick from the 7.4% y/y reported in March. Tobacco product inflation came in at 2.6% y/y, down from 4.8% y/y a month ago. Six of the nine sub-categories in this basket item posted either slowing or steady inflation. Pipe Tobacco, Brandies and Beers/Ales/Ciders were the only sub-categories which saw prices grow faster in April than in March.

Housing, Water and Electricity, which has the heaviest weighting in the inflation basket at 28.4%, was the largest contributor to inflation among the remaining categories and replaced Transport as one of the top three contributors to Namibia’s annual inflation print. Inflation in this category came in at 2.6% y/y in April, down from 3.0% y/y in March. All four sub-categories in this basket item recorded slowing inflation compared to March on a year-on-year basis. Prices of Electricity, Gas and Other Fuels fell by 0.4% m/m, while annual inflation in this subcategory slowed to 4.9%. Prices in the Regular Maintenance and Repair of Dwelling sub-category decreased by 0.4% m/m with annual inflation coming in at 4.8%. Rental inflation and prices of Water Supply, Sewerage Service and Refuse remained steady month-on-month with annual inflation at 2.1% and 2.5%, respectively.

Outlook

The steep drop in April’s inflation print to 6.1% is primarily due to base effects in the Transport category with fuel prices now only marginally higher than they were a year ago. Still, the slowdown should be a welcome development for the Bank of Namibia (BoN) and its quest to temper inflationary pressure. The drop in April’s inflation print, coupled with the fact that we see inflation starting to ease in other parts of the world, may signal the start of a much-anticipated disinflationary cycle which in turn could see the end of the BoN’s tightening of the belt. The BoN raised lending rates by a further 25bps last month, again deciding to not hike as aggressively as the South African Reserve Bank (SARB) last time round and now lags the SARB’s lending rate by 50bps.  Elevated food prices and a weak currency do however pose risks to the BoN’s inflation fight.

IJG’s inflation model continue to predict a gradual slowdown in Namibia’s annual inflation rate over the remainder of year, before ending the year at around 4.8%.