Category Archives: Vehicle Sales

A total of 1,252 vehicles were sold in September, 8.5% less than the number of vehicles sold in August and 23.9% down compared to the number of vehicles sold in September 2015. Since January this year, 13,058 vehicles have been sold, down 19.3% from the number of vehicles sold over the comparable period last year. Vehicle sales have been declining during 2016 when compared to 2015 and 2014 although still above the levels seen in 2013.

As indicated by the below figure, the 12-month cumulative number of vehicles sold has been contracting since December 2015. The rate of contraction has been rapid with this measure of vehicles sold falling 17.9% year on year and 2.1% month on month. The contraction in 12-month cumulative vehicle sales has been led by passenger vehicle sales which have been slowing at a more rapid rate than the same measure for commercial vehicle sales.

On a monthly basis, total passenger vehicle sales fell 5.2% to 509 in September. Year to date, total sales of passenger vehicles declined by 21.6% to 5,571 from 7,199 sold over the same period last year. Commercial vehicle sales fell 10.7% month on month and 22.8% year on year, while year to date figures dropped by 17.4% from 9,069 to 7,487. Light, medium and heavy commercial vehicle sales dropped on a month on month basis as well as on a year-to-date basis.

Toyota and Volkswagen dominated the passenger vehicle market yet again, with the two brands claiming 31.2% and 26.7% of the market share respectively.  Toyota was the outright leader in light commercial vehicle sales with 46.9% of the market, followed by Nissan at 17.7%, and Isuzu in 3rd place with 13.9%.

 The Bottom Line

Vehicle sales have been contracting by most measures in 2016 for a number of reasons, namely, higher interest rates, a slowdown in government spending (on vehicles as well as in general), recent amendments to the Credit Agreement Act, as well as the high base against which these measurements are compared. The high base created in 2014 and 2015 was a result of large amounts of government spending and rapid growth in private sector credit extension which drove strong economic growth. The pro-cyclical nature of government’s fiscal and monetary policy has resulted in a slightly overheated Namibian economy, and thus a drop in vehicle sales from the high base set in previous years is to be expected.

Going forward we expect to see government spending cut further in the next fiscal year as well as a prolonged freeze on new hires by the state. Interest rates may rise further due to the aforementioned slowdown in government spending affecting banking sector liquidity as well as the probability of both a South African and Namibian credit ratings downgrade to sub-investment grade. These factors along with a weakening Rand are likely to put further pressure on vehicle sales going forward.

A total of 1,369 vehicles were sold in August, 12.8% less than the number of vehicles sold in July and 14.1% down compared to the number of vehicles sold in August 2015. Since January this year, 11,806 vehicles have been sold, down 18.7% from the number of vehicles sold over the comparable period last year. Vehicles sales is currently trending down a year-on-year basis. This suggests that this trend is likely to continue going forward.

For the past 12 months, the number of vehicles sold on a cumulative basis in Namibia has been declining, posting negative since December 2015. On a 12-month cumulative basis, 18,523 vehicles were sold up to the end of August 2016, 17.1% less than the number of vehicles sold over the same period last year and 1.2% less than the cumulative number of vehicles sold in the 12 months to July this year.

On a monthly basis, total passenger vehicle sales fell by 17.8% to 537 in August, the lowest number of passenger vehicles sold since January 2013. Year to date, total sales of passenger vehicles declined 21.2% to 5,062 from 6,423 sold in the same period last year. The number of commercial vehicles sold decreased on a year-to-date and year-on-year basis, down 16.8% and 11.3% respectively. Year to date, 6,744 commercial vehicles have been sold, down from 8,106 sold in the same period in 2015. The decrease in the number of commercial vehicles sold was mainly driven by a contraction in light and medium commercial vehicle sales. On a month-on-month basis, the number of commercial vehicles sold declined by 9.3% in August to 832, down from 917 in the preceding month.

Toyota and Volkswagen dominated the passenger market, selling the most vehicles in August, with the two brands claiming 29.2% and 28.7% respectively.  Toyota once again was the market leader in light commercial vehicles, having the lion’s share of sales at 45.2% of the market, followed by Nissan at 16.6%, and Isuzu in 3rd place.

The Bottom Line

Throughout the period of 2014 all the way to mid-2015, we have seen robust growth in vehicle sales, which was driven by a strong consumer base supported by expansionary fiscal and monetary policy and real wage growth in those periods. However, recent data indicates that this is no longer the case as vehicles sales contractions have been seen. Strong growth in vehicle sales over the last couple of years has significantly increased the base on which vehicle sales growth is calculated and this has contributed to the contractions seen in vehicle sales on a 12-month cumulative basis and year-to-date basis. That said the number of vehicles sold on an annual basis is still fairly strong.

The slowdown in the number of vehicles sold has been driven by a number of factors. For instance, higher interest rates and inflation levels, reduction in government spending (directly on vehicles and otherwise), and a weaker economic climate at large have adversely impacted the demand for vehicles. In addition, the amendment to the Credit Agreement Act made on 20 July, enforcing a mandatory 10% deposit on all passenger vehicles and reducing the maximum repayment period to 54 months will further drive down vehicle sales and growth thereof going forward.

A total of 1,570 vehicles were sold in July, 1.2% less than the number of vehicles sold in June and 18.8% down compared to the number of vehicles sold in July 2015. Since January this year, 10,437 vehicles have been sold, down 19.3% from the number of vehicles sold over the comparable period last year. Vehicles sales is currently trending down on a year-on-year basis. This suggests that this trend is likely to continue going forward.

For the past 12 months, the number of vehicles sold on a cumulative basis in Namibia has been declining, posting negative since December 2015. On a 12-month cumulative basis, 18,747 vehicles were sold up to the end of July 2016, 16.5% less than the number of vehicles sold over the same period last year and 1.9% less than the cumulative number of vehicles sold in the 12 months to June this year.

On a monthly basis, total passenger vehicle sales rose by 1.6% to 653 in July. On an annual basis however, total sales of passenger vehicles declined 16.5% from 782 in July 2015. The number of commercial vehicles sold decreased on a year-to-date and year-on-year basis, down 17.5% and 20.3% respectively. The decrease in the number of commercial vehicles sold was mainly driven by a contraction in light and medium commercial vehicle sales. On a month-on-month basis, the number of commercial vehicles sold declined by 3.1% in July from 946 in the preceding month.

Toyota and Volkswagen continue to dominate the passenger vehicle segment with Toyota selling 207 (31.7%) vehicles and Volkswagen selling 158 (24.2%) of the 653 passenger vehicles sold. Toyota was the market leader in light commercial vehicle sales with 46.8% of the sales in this segment, followed by Ford with 15.4% and Isuzu in third place with 12%. Commercial vehicle sales continue to come in higher than passenger vehicle sales as has been the long term trend.

The Bottom Line

Throughout the period of 2014 all the way to mid-2015, we have seen robust growth in vehicle sales, which was driven by a strong consumer base supported by expansionary fiscal and monetary policy and real wage growth in those periods. However, recent data indicates that this is no longer the case as vehicles sales contractions have been seen. Strong growth in vehicle sales over the last couple of years has significantly increased the base on which vehicle sales growth is calculated and this has contributed to the contractions seen in vehicle sales on a 12-month cumulative basis and year-to-date basis. That said the number of vehicles sold on an annual basis is still fairly strong.

The slowdown in the number of vehicles sold has been driven by a number of factors. For instance, higher interest rates and inflation levels, reduction in government spending (directly on vehicles and otherwise), and a weaker economic climate at large have adversely impacted the demand for vehicles. In addition, the amendment to the Credit Agreement Act made on 20 July, enforcing a mandatory 10% deposit on all passenger vehicles and reducing the maximum repayment period to 54 months will further drive down vehicle sales and growth thereof going forward.