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February Truck Sales Sustain Market Growth

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The total of 2 364 trucks, buses and vans with Gross Vehicle Mass ratings of more than 3 500 kg reported to the National Association of Automobile Manufacturers of South Africa (NAAMSA) during the month of February, 2013, improved by a margin of 22,4%, on the outcome for January 2013, but was 4,4% less than the result recorded one year earlier, in February, 2012. However, the combined total cumulative sales of 4 295 units reported in January and February, 2013, was 3,1% better than the equivalent year-to-date total of 4 164 units standing at the end of February, 2012.

The total of 2 364 trucks, buses and vans with Gross Vehicle Mass ratings of more than 3 500 kg reported to the National Association of Automobile Manufacturers of South Africa (NAAMSA) during the month of February, 2013, improved by a margin of 22,4%, on the outcome for January 2013, but was 4,4% less than the result recorded one year earlier, in February, 2012. However, the combined total cumulative sales of 4 295 units reported in January and February, 2013, was 3,1% better than the equivalent year-to-date total of 4 164 units standing at the end of February, 2012.

At this stage, all volumes quoted in this analysis still include aggregated MCV sales recorded by Associated Motor Holdings and Amalgamated Automobile Distributors, which, currently, are made up exclusively of Hyundai-branded light truck models, and NAAMSA's estimates, by segment, for deliveries by Mercedes-Benz South Africa, who, as directed by their overseas principals, have continued to report only aggregated sales data to the local organisation. NAAMSA expects a normalisation of the reporting situation to occur during the course of 2013

As published, the February market composition was made up of 868 Medium Commercial Vehicles (GVM ratings between 3 501 kg and 8 500 kg), 422 Heavy Commercials (goods vehicles with GVM ratings between 8 501 kg and 16 500 kg), 964 Extra Heavy Commercials (goods vehicles with GVM ratings above 16 500 kg) and 110 passenger Buses with GVM ratings above 8 500 kg. The year-to-date market segmentation "mix" prevailing up to the end of February, 2013, has exhibited only minor variations from that calculated for the entire year in 2012, with MCV's holding 36,7% of the market (35,3% at the end of 2012), HCV's at 17,5% (17,8% in 2012), EHCV's at 42,2% (42,9% in 2012) and Buses at 3,6% (3,9% in 2012).

Dr. Casper Kruger, Vice President of Hino in South Africa, comments: "With the results for the first two months of 2013 now available, it is perhaps still too early to draw too many firm conclusions regarding the ultimate size and composition of the 2013 truck market, beyond a broad expectation of a final total volume of around 28 000 units. At this stage, the margin of growth achieved remains in the same ballpark as that returned in 2012 over the 2011 outcome, but we will need to monitor trends in the months ahead before any rational predictions of radically altered ultimate market size, or segmentation profile, can be ventured".

Kruger continues: "However, we have noted the encouragement provided by the most recent published results of the Kagiso Purchasing Managers' Index, which suggest that the business mood in the country has improved. Some of this bullishness in the manufacturing sector may stem from the continuing trend of Rand weakness against the currencies of our main trading partners, which, one one hand, enhances the offshore price competitiveness of South African exports, but, at the same time, also places upward pressure on the local prices of vehicles and parts, as well as other imported goods. In the road transport industry, it is likely that this consideration may have benefitted recent new vehicle sales, as operators have sought to acquire additional or replacement trucks, buses or vans at pre-increase prices. There is also the issue of the steady increase in fuel costs, which has been ameliorated, to some extent, by a softening recent trend in international oil prices, but which remains highly exposed to continuing Rand weakness".

Kruger concludes: "The sharp widening of South Africa's foreign trade balance to unprecedented negative levels during the month of January is likely to continue exerting negative pressure on the Rand's foreign exchange values until evidence of improved national export performance restores this important economic indicator to more normal levels. However, the continued commitment of the government to its infrastructure and employment generation programmes, as evidenced in the recent National Budget speech, promises to underpin local demand for commercial vehicles. Despite the upward pressure on pricing noted above, there are no indications, at this stage, of any deterioration in the financing environment for these vehicles, so the outlook for sales remains positive in the months immediately ahead".

 

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