Auto Insights Newsletter | April 2022

New vehicle sales grow despite tough market conditions

Growth in sales could reach 11% in 2022

New vehicle sales in March 2022 (50 465 units) were 16.2% up on March 2021, according to naamsa.

The March 2022 figure was 14.1% up on February as the local market continues to grow despite the world-wide semi-conductor shortage negatively impacting motoring brands and markets across the globe.

While many high-volume brands, particularly those with entry level offerings, continue to sell relatively strongly, a number of premium brands look to be struggling as stock shortages begin to take their toll.

While Passenger vehicle sales grew by 27.0% year-on-year in March to 33 788 units, Light Commercial Vehicles sales were 2.7% down at 13 973 units when compared with March 2021.

New vehicle sales

Overall sales for the first quarter of 2022 were 18.0% higher than for 2021, and 16.2% above sales in 2020-Q1.

naamsa reported a total of 136 192 units sold in quarter one, of which around 84.4% represented dealer sales. Passenger vehicle sales were up 25.7% year-on-year, and sales of LCVs increased by 2.9% compared to 2021.

The car rental industry accounted for an estimated 9.6% of new Passenger car sales in the first quarter of 2022, ahead of the 9.4% share in the 2021 window but slightly behind the 10.5% in 2020.

Quarter 1 Passenger & Light Commercial new vehicle sales

Sales in 2022 should increase despite pressures throughout the macroeconomic environment, with GDP expected to produce lower levels of growth in 2022 than 2021, headline consumer inflation likely to drift towards the upper reaches of the Reserve Bank’s target range and the Reserve Bank’s continued interest rate hikes during the year.

This is all in addition to the semi-conductor shortage and supply issues, which may be further exacerbated by the war in Ukraine.

This puts projected new vehicle sales for 2022 at around 516 000 units, of which 486 000 are Light vehicles (Passenger and Light Commercial). Overall, growth in new vehicle sales is expected to end 2022 in the region of 11%.

New vehicle sales - 2017 to 2022

Market observations

The Crossover segment (which includes the Haval Jolion, Toyota Corolla Cross and Volkswagen T-Cross) was the largest Light Vehicle (Passenger & LCV markets) segment in the first quarter of 2022, with 28 908 new units sold – of which 91% were Dealer sales, and 7% reported through the Rental channel.

Crossover segment sales picked up 62% from 2021-Q1, which in turn was 16% ahead of the segment total for the first three months of 2020. This makes the Crossover segment the best performing Light Vehicle segment in terms of sales growth and accounted for 22% of all Light Vehicle sales in the first quarter, up from 16% market share a year ago.

The second-best performing segment in terms of volume was the Entry segment (which includes Renault Kwid, Toyota Starlet and VW Polo Vivo) with 24 123 units sold over the first quarter of 2022, with sales strengthening from 2021 by 19%.

The second most improved segment for year-on-year growth in sales was the MPV segment (which includes Hyundai Staria, Suzuki Ertiga and Toyota Rumion), with a jump of 24% over the first three months of 2021.

Light Vehicle Segments - first quarter share of Light Vehicle market