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Wesbank says the South African automotive industry has recorded a strong first half with growth of 10.46% year on year.
However, the executive head of sales and marketing at Webank, Chris de Kock, says first half growth in 2012 was slower than the 15.83% growth rate recorded in the first six months of last year.
According to De Kock the passenger car market continues to be the best performing segment while heavy commercial vehicle sales have taken a knock in spite of a strong performance in that segment last year.
He said that the slow-down was not unexpected.
"We always knew that the growth rate in 2012 was always going to be difficult to achieve what was achieved in 2011 mainly because of the base effect. We see that the market is slowing but on the positive side the number of vehicles that were sold and the actual growth that the industry enjoyed over the first of half of the year was very pleasing," said De Kock.
Looking ahead he said several factors will influence the rest of the year.
De Kock it would be difficult to improve on the base effect established last year where the sales in the last six months was very strong. "To grow on what was already a very strong performance last year is going to be very tough than what it was in the first half of the year."
He says the second key influence will be crisis in the Eurozone and the possible impact it would have on South Africa. De Kock said there still appears to be a lot of "negative sentiment that is washing across to our shores as a result of the uncertainty in Europe."
The third thing that could influence the vehicle market in the second half of the year is consumer demand, he said.
"Consumer demand is fueling the growth because it remains very much a buyers market. The interest rates are at a 40-year-low and vehicle CPI remains in zero to negative territory."
"The kind of value proposition that is being put on the table by motor manufacturers operating in a very competitive market, combined with very low interest rates, means that customers can trade in their cars and buy a new car and pay a very similar, if not, a lower payment than what they were paying on their existing car and that is driving that demand," said De Kock.
