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Vehicles Sales Demand Strongest Since 2018


By:Staff writer
June saw 584 more vehicles sold than during the same month last year, representing an 86.4% year-on-year increase in vehicle sales.
For 2023 thus far, 7,700 vehicles have been sold, of which 3,797 were passenger vehicles, 3,451 were light commercial vehicles, and 452 medium- and heavy commercial vehicles.
According to analysis by IJG Namibia, overall new vehicle sales demand remains strong, with most of the metrics trending around levels last seen in early 2017.
While the July sales are 60 vehicles sales less than the 1,320 seen in the month before, the trajectory of sales is on the increase, outperforming pre-pandemic levels and commencing the third quarter of 2023 on a high note.
Vehicle sales in July 2023 also recorded the highest sales level since July 2018, surpassing pre-pandemic sales.
“New passenger vehicles sales were particularly strong during the month, and while commercial vehicle sales came in slightly softer in July than in June, the trend over the longer term remains upward,” IJG states.
Analysis from Simonis Storm Securities (SSS) has also established that the average prices of vehicles that are purchased locally rose on average by 12.8% y/y in July 2023, with heavy commercial vehicles increasing at the steepest pace on an annual basis.
“Despite rising prices of new vehicles and higher interest rates, vehicle sales remain resilient. Toyota, Volkswagen, Ford, Kia and Nissan have been dominating the market for the year,” SSS analysts said.
It has further been observed that household and corporate instalment and leasing credit remain on an upward trend at 4.2% y/y increase and 15.7% y/y increase in July 2023, respectively.
“While this supports strong vehicle sales levels, cash sales are increasing as credit has become more expensive. The average vehicle loan across the country is priced at prime rate plus 2 percentage points (13.50%) at the moment.
“We anticipate that this will remain as Bank of Namibia will likely keep the repo rate and prime rate unchanged at 7.75% and 11.50% respectively in August, further encouraging car loans. Therefore, for the short term we anticipate vehicle sales to remain resilient,” SSS stated.

Staff Writer

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