Numerous global markets have seen robust growth in the past decade, but South Africa’s vehicle market has for the most part been stuck in second gear.
Data from Naamsa - The Automotive Business Council - shows that while the country’s new vehicle market did recover from the lows of the global recession and pandemic, which saw sales dip below 400,000 units in 2009 and 2020, it still trails the period between 2020 and 2016 when the market rose above the 600,000 mark.
Just 531,787 vehicles were sold in 2023, bringing the market back to the pre-pandemic levels of 2019.
However, until the South African economy picks up and interest rates start to come down, something that’s likely to happen later this year, local buyers will continue to gravitate towards lower-priced vehicles, Lightstone Auto says.
“While tough economic conditions dampen consumer spending, lifestyle changes and consumer resilience drive new ways of adapting to a changing reality - and we see this in the car brands South Africans buy,” says Paul Marshall, Managing Director of Lightstone Auto.
Lightstone released an illustration showing South Africa’s top vehicle brands since 2019, and while Toyota and Volkswagen have remained in the top two spots, everything below that has been to play for, with Hyundai, Ford, Nissan and most recently Suzuki, all occupying third spot at some stage in the past 15 years.
Suzuki’s meteoric rise can no doubt be attributed to its vast range of lower-priced offerings sourced from Maruti Suzuki of India. The brand now enjoys a dominant third placed position.
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Brands such as Renault, which sources the majority of its products from India, as well as Chinese brands Haval and Chery, have entered the top ten in the last 15 years while German luxury brands BMW and Mercedes-Benz have fallen off this list in what certainly seems to be a sign of challenging economic times.
“Dealerships mirror these market shifts. Brand-switching and multi-brand offerings are becoming more common, in a departure from years past when single brand dealerships were common,” Marshall says.
SUVs ousting hatches and sedans
However the difficult economic conditions have not stopped South Africans from following the global shift to SUVs and crossover vehicles. This has been largely enabled by the proliferation of lower-priced compact and medium-sized SUV models.
Lightstone data shows that these high-riding vehicles have grown to represent more than 35% of the overall market, and 50% of the passenger vehicle share, while hatchbacks have seen their overall share decline from 35% to 26% and sedans seem all but dead in the water, having fallen from 21% to 5% since 2009.
“The domestic automotive retail market is experiencing winds of change when it comes to brands, body shapes and categories. Price will be important so long as economic growth and consumer confidence remain flat,” Marshall concluded.