Category Archives: Economic Research

Economic Research

New Vehicle Sales – October 2021

By | | ,
Comments Off on New Vehicle Sales – October 2021

714 new vehicles were sold in October, the second lowest monthly sales figures for 2021. This comes after 767 vehicles were sold in September. Fewer passenger vehicles, light commercial vehicles and heavy commercial vehicles were sold in October than in September. Only the number of medium commercial vehicles sold increased, from 16 in September to 22 in October. Year-to-date, a total of 7,935 new vehicles have been sold. Despite the low monthly sales figure, new vehicle sales increased by 27.3% y/y in October. On a 12-month cumulative basis, vehicle sales have grown by 19.7% to 9,339.

356 new passenger vehicles were sold in October, 24 fewer than in September. This translates to a 6.3% m/m decrease, but a 19.5% y/y increase. On a 12-month cumulative basis, new passenger vehicle sales have increased by 38.0% y/y to 4,414. Despite being a somewhat weaker month for passenger vehicle sales, October’s sale figure is not far off the average monthly sales figure for the past 12 months. 

Total commercial vehicle sales declined by 7.5% m/m but increased by 36.1% y/y in October. The biggest month-on-month decline in both absolute number and percentage terms came in the heavy commercial vehicles category. The 41 heavy commercial vehicles sold is 26 fewer than in September, representing a 38.8% m/m decrease in sales. That said, heavy commercial vehicle sales are up 46.4% y/y. Light commercial vehicle sales followed a similar pattern. 295 light commercial vehicle sales in October translates to a 3.0% m/m decrease, but 35.9% y/y increase in sales.  22 medium commercial vehicles were sold in October, an increase of 37.5% m/m and 22.2% y/y.

Toyota and Volkswagen remain the pre-eminent brands in the passenger vehicle market. Toyota’s year-to-date market share is 29% and Volkswagen’s is 28%. To illustrate their dominance, even if the market shares of the next four largest brands are combined (Kia, Suzuki, Hyundai and Haval, in that order) their stake is still smaller than that of Volkswagen.    

On a year-to-date basis, Toyota has the largest market share of light commercial vehicles. Toyota’s market share in the category declined marginally from 54% in September to 53% in October. The medium commercial vehicles sector remains more competitive, with both Hino and Mercedes taking a 30% share of the market. Scania, Volvo and Man are the biggest players in the heavy and extra heavy commercial vehicle market, with 25%, 19% and 15% market shares respectively.  

The Bottom Line  

October 2021 was a below average month for both passenger and commercial vehicle sales in Namibia, all but confirming that 2021 will be the second worst year for new vehicle sales in the past decade. This did not necessarily appear to be the case at the beginning of the year. In the first two months of 2021 more new vehicles were sold than in the first two months of 2019. Then the figures started to diverge. Global headwinds in the form of supply chain bottlenecks and semiconductor shortages interacted with domestic lockdowns through-out the year to effectively drag down sales during 2021. Finally, as December usually sees below yearly-average vehicle sales, regardless of the underlying health of the economy, there is even less chance that new vehicle sales in 2021 will rise to, or past, 2019 levels.

NCPI October 2021

By | | ,
Comments Off on NCPI October 2021

The Namibian annual inflation rate rose to 3.6% y/y in October of the back of a 3.5% y/y increase in prices in September. Prices in the overall NCPI basket rose by 0.2% m/m. Year-on-year, overall prices in five of the twelve categories rose at a quicker rate in October than September, five categories experienced slower rates of inflation and two categories posted steady inflation. Prices for services rose by 2.4% y/y and prices for goods rose by 4.5% y/y.

Prices in the transport category increased by 0.7% m/m and 10.7% y/y. As such, transport was the largest contributor to annual inflation in October, contributing 1.5 percentage points to the total 3.6% y/y inflation rate. Prices in all three of the sub-categories recorded increases on an annual basis. Vehicle prices increased by 10.4% y/y, public transport costs increased by 3.5% y/y and prices in the sub- category “operation of personal transport equipment” increased by 13.6% y/y.  A 22.4% y/y increase in the price of petrol and diesel is responsible for much of this increase. This increase is due partially to base effects as the price of fuel decreased by 11.3% m/m and 12.5% y/y in October 2020. A global shortage in oil supply is the other major factor contributing to increases in the price of fuel.

The last year and a half have seen taxi fares at their most volatile. The price of taxis increased by 3.9% y/y in October. This comes after two-consecutive months of 8.7% y/y decreases. Looking further back, in May 2020 taxi fares rose by a remarkable 13.6% m/m, held steady for a few months and then declined by 11.3% m/m in October 2020, according to the Namibia Statistics Agency. Another month-on-month spike in June 2021, a 14.6% m/m increase, was followed by a 9.9% m/m decrease in August 2021. This volatility has led to uncharacteristic oscillations in the year-on-year price movements of taxi fares.

Food & non-alcoholic beverages was the second biggest contributor to the annual inflation rate in September, contributing 1.0 percentage point. Prices in this basket increased by 0.9% m/m and 5.2% y/y. All sub-categories registered price increases on a monthly basis. Additionally, all sub-categories except for one, vegetables & tubers, registered price increases on a yearly basis. The largest year-on-year price increases came in the oils & fats and fruit categories, with increases of 16.9% y/y and 15.4% y/y respectively.

Inflation for the rest of the categories were relatively subdued, with the miscellaneous category being the third largest contributor to October’s annual inflation rate, increasing by 0.1% m/m and 6.6% y/y. Surprisingly, the category alcoholic beverages & tobacco was not amongst the largest contributors to annual inflation in October. Prices for alcoholic beverages decreased by 0.9% m/m and 0.1% y/y while prices for tobacco products increased by 0.7% m/m and 5.9% y/y.

The 3.6% y/y annual inflation rate is in line with IJG’s average inflation forecast for the year. IJG’s inflation model predicted that annual inflation would be 3.5% y/y in October. Inflation risks globally and in Namibia remain to the upside. Our model currently estimates that inflation will rise to 3.8% y/y in November and 4.0% y/y in December.  Average inflation for 2022 is forecast at 3.9% y/y. The estimated upper bound for average annual inflation in Namibia for 2022 is 5.0% y/y. Should the value of the rand continue to deteriorate, and if oil prices continue to rise, the forecast will inevitably trend towards the upper bound.