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.