According to Simonis Storm Securities, vehicle sales increased by 11.3% month on month to 918 units in May 2018 after a massive drop of 27.8% reported in the prior month.
The uptick was mainly supported by light commercial vehicles which increased by 110 units (+27.7%) in May (Table 1).
This comes after light commercial vehicle fell 31% in April. Despite the monthly increases observed in May, vehicles sales remain below the 10-year average of 1 240 units.
New vehicle sales stood at 4 805 units at the end of May 2018, lower than 5 536 units recorded over the same period in 2017, 13.2% decrease.
“To boost car sales, we have observed numerous special schemes such as the 6 months payment holiday and prime less 4% on new car sales. This is our view indicates the lack of spending by consumers in the new motor vehicle space and this is evident in the low instalment credit (-5.1% y-o-y). Tough economic conditions are set to prevail in the second half of 2018, putting more pressure on the motor vehicle industry,” says the firm’s Indileni Nanghonga.