Category Archives: Vehicle Sales

Vehicle Sales

Vehicle Sales – March 2015

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Vehicle sales Mar

A record 2,150 new vehicles were sold in Namibia during March, up 10.4% m/m and 14.4% y/y. This comes off a high base as both February 2015 and March 2014 saw elevated sales levels, March 2014 also being a record month at the time. Month on month passenger vehicle sales rose by 10.8% after being up 10.4% in February to a record 910 units sold. On a year on year basis only 2 more passenger vehicles were sold than in March 2014 although the base month experienced exceptionally high sales. Commercial vehicle sales came close to record levels as well with month on month sales increasing by 10.1% and year on year sales increasing by 27.7%. As is expected during the record sales month the 12 month cumulative vehicle sales is up a further 1.2% to 22,590. Year to date new vehicle sales amount to 5,813, 12.3% up from last year’s already high base.

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Once again Toyota and Volkswagen dominated the passenger vehicle market, claiming 57.8% between them. 36.5% of all passenger vehicles sold during March were Toyotas while Volkswagen made up 21.3% of the market. Nissan gained some market share and captured 5.6% of the March passenger vehicle sales while Kia lost some market share.

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The light commercial vehicle segment breached the 1,000 vehicles sold level for the 6th time within the year as 1,087 vehicles were sold in March, up 6.3% m/m. This space was also dominated by Toyota with more than 50% market share. Nissan captured almost 20% of the market share with the 20 other manufacturers sharing the remaining 30%. A record total of 93 heavy commercial vehicles were sold during March, up 19.2% m/m. 60 medium commercial vehicles were sold, another record, up 140% m/m from a low base.

The Bottom Line

The strong increase in vehicle sales is attributed to a number of factors, namely the on-going expansive fiscal and monetary positions of the Ministry of Finance and Bank of Namibia, as well as purchase of vehicles by Government.The Ministry of Finance has allocated N$984.5m to vehicle purchases in the 2014/15 National Budget, this is N$517.8m or 111.0% more than what was spent on vehicles during the previous financial year. With the financial year ending in March is possible that government has spent any under-allocation of this budget during the month propping up the sales statistics. It is not unusual for March to be a record month due partially to the government year-end.

Continued spending by the mining sector has helped drive vehicle sales during the past year while real wage growth and the strong local economy have bolstered sales. The strong state of the Namibian consumer can thus be well illustrated by vehicle sales figures. However as no cars are manufactured in Namibia, all new vehicles sold must be imported. Given the small, open, nature of the Namibian economy, this puts major pressure on the country’s balance of payments, which pressure cannot be sustained long-term. April vehicle sales are expected to be lower than March due in part to the high base and historically April sales are softer.

Vehicle Sales – February 2015

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1,947 new vehicles were sold in Namibia during February, up 13.5% m/m, which is mostly due to January being a seasonally slower month. The higher monthly numbers, compared to January, were on account of a 15.7% increase in commercial vehicle sales and a 10.5% rise in passenger vehicle sales. At this point, total sales for the year stand at 3,663 vehicles, up 11.1% on the comparable period of 2014.

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The 12-month cumulative measure increased further to 22,319 and is now 29.6% higher than a year ago, up 0.7% from the previous month.In our view the growth in the 12-month cumulative number is largely a result of a lower base in the previous year.

Sales of passenger vehicles increased by 10.5% m/m to 821 vehicles sold during the month, up from the previous month’s 9.7% contraction. On an annual basis, passenger vehicle sales rose, increasing 11.1% y/y after increasing 6.4% in January. Commercial vehicle sales rose 15.7% to a sales figure of 1,126 vehicles, which was due to higher sales numbers of light commercial vehicles on the back of government tenders coming through. On an annual basis, commercial vehicle sales increased by 7.2%.

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Toyota and Volkswagen dominated the passenger market, selling the most vehicles in February, with the two brands claiming 26.9% and 24.1% respectively. Toyota once again was the market leader in light commercial vehicles, having the lion’s share of sales at 48.1% of the market, followed by Nissan at 16.3%, and Ford in 3rd place.

The Bottom Line

The strong increase in vehicle sales is attributed to a number of factors, namely the on-going expansive fiscal and monetary positions of the Ministry of Finance and Bank of Namibia, as well as purchase of vehicles by Government.The Ministry of Finance has allocated N$984.5m to vehicle purchases in the 2014/15 National Budget, this is N$517.8m or 111.0% more than what was spent on vehicles during the previous financial year. Additionally, the mining sector has purchased a number of commercial vehicles over recent months, largely on account of the on-going construction of the Tschudi, Otjikoto and Husab mines in the country.

Strong growth in the local economy, (expected) falling unemployment and increased wages, has increased the disposable income of consumers, which disposable funds are often used to purchase vehicles. The strong state of the Namibian consumer can thus be well illustrated by vehicle sales figures. However as no cars are manufactured in Namibia, all new vehicles sold must be imported. Given the small, open, nature of the Namibian economy, this puts major pressure on the country’s balance of payments, which pressure cannot be sustained long-term.

The strong growth witnessed in February is expected to continue, however may slow towards the end of the year as monetary policy tightening starts to gain traction. Nevertheless, government tenders yet to be delivered are expected to maintain the momentum of the vehicle sales through 2015.

 

New Vehicle Sales – January 2015

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Vehicle sales jan

1,716 new vehicles were sold during January, a drop of 6.3% from the December sales of 1,831, but an increase of 13.9% over January 2014. Passenger vehicle sales came in at 743, slightly below the average for 2014 of 803, nevertheless increasing modestly year on year. Commercial vehicle sales saw similar results, declining 3.5% month on month but increasing 20.3% year on year. Rolling 12 month sales once again reached record levels this month, with the year on year 12 month percentage change above 30% for the 11th consecutive month.

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Toyota and Volkswagen continue to dominate the passenger vehicle segment with Toyota selling 274 (37%) vehicles and Volkswagen selling 146 (20%) of the 743 passenger vehicles sold. Toyota was also the market leader in light commercial vehicle sales, having the lion’s share at 52% of the market, followed by Nissan at 15% and Ford in third place with 11%. Commercial vehicle sales continue to come in higher than passenger vehicle sales as has been the long term trend.

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The Bottom Line

The strong vehicle sales is attributed to a number of factors, namely the on-going expansive fiscal and monetary positions of the Ministry of Finance and Bank of Namibia, as well as purchase of vehicles by Government. The Ministry of Finance has allocated N$984.5m to vehicle purchases in the 2014/15 National Budget, a N$517.8m (111.0%) increase on the vehicle expenditure budget of the 2013/14 financial year. Government tenders yet to be delivered should maintain the momentum of vehicle sales through 2015. Strong economic growth and ever increasing private sector credit extension should bolster this trend in growth.