By: Nghiinomenwa Erastus
Lack of cargo ships and containers, chips shortage, and Covid-19 disruption have caused unnecessary delays in the supply of new vehicles in the country.
According to Simonis Storms analysis for August 2021 vehicle sales figures for the country.
Brands such as Toyota have a backlog of about 300 customers who are waiting for their newly purchased vehicles to arrive in Namibia, Simonis Storm highlighted.
The analysis revealed that “due to delivery delays, some brands have mentioned that they have lost customers as they were not able to source the correct vehicles, while some customers switched to alternative brands”.
Moreover, the supply constraints leading to stock shortages in aftermarket spare parts also negatively impact the workshops in the country.
Simonis Storm’s assessment highlighted that most local car dealerships have reported delays in car imports.
Normally, it took between two to three months for car imports to arrive in Namibia.
“Nowadays, it takes between five to seven months for imports to arrive. There are a few factors behind this,” the report stated.
According to Simonis Storm’s findings, the delays are a result of multiple factors in the global supply chain.
Firstly, semiconductors (electronic chips) used in the manufacturing of cars, cell phones, washing machines, etc. are in short supply and cannot meet industry demand.
Secondly, staff shortages and disruptions caused by Covid-19 cases in manufacturing plants lead to production delays.
Lastly, the shortage and skyrocketing cost of cargo ships and containers is kindly disrupting and slowing the global logistical chain.
“Expectations from local dealerships are that imports/delivery of new cars in the
the coming months will remain inconsistent,” Simonis and Storm reported.
NEW CARS TO GET EXPENSIVE
The impact for low supply and backlog has a negative impact on consumers as the importing cost piles up for dealers which get to be passed on to the consumers through car prices.
The report has also warned that higher car prices are expected in the coming months.
Simonis Storm has revealed that car brands like Ford, prices in Namibia have already received four increases since February 2021.
The general consensus observed in the automotive industry by the researcher is that they foresee vehicle prices remaining on an upward trend over the next months.
The report highlighted that higher prices have led customers to substitute into the second-hand car market, “as most local dealers observe increases in sales in their second-hand segment”.
This in turn adds inflationary pressure to the second-hand segment of the vehicle market.
Another trend being observed by some local dealers is that customers tend to drive their cars longer (deviating from the three-year-replacement cycle).
“Customers also opt to purchase extended warranties and downsize to more affordable cars,” Simonis Storm findings show.
For the month of August 2021, a total of 764 vehicles were sold (compared to 800 sold in the prior month) according to the National Association of Automobile Manufacturers South Africa (NAAMSA).
Light commercial and passenger vehicles made up 46,3% and 44,5% of total vehicles sold during August 2021, respectively.
For the months of June and July 2021, the country has to spend N$184 million and N$113 million on motor vehicle imports, the import data shows.
On a monthly basis, motor vehicle imports account for between 1,4% to 2% of the total country imports. Email: erastus@thevillager.com.na
