Toyota Leads Retail Sales in a Weaker Market
- Toyota retains market leadership
- Export sales drop as manufacturers change model lines
- New Corolla expected to boost sales from March onwards
|Market segment||January 2013||January 2014||% change|
|Passenger vehicles||40 865||38 008||-7.00%|
|Light commercial vehicles||14 067||13 145||-6.6%|
|Medium commercial vehicles||780||780||–|
|Heavy commercial vehicles||329||265||-19.5%|
|Extra Heavy commercial vehicles||819||769||-6.1%|
|Vehicle exports||17 393||13960||-19.7%|
|Overall market (local)||56 899||53025||-6.8%|
Toyota South Africa Motors delivered 10 659 new vehicles to customers to start the New Year as the market leader in South Africa. This represents a market share of 20.1% in a market that decreased by 6.8% compared to the same month in 2013.
“The market shows clear signs of slowing, despite the normal seasonal anomalies that we expect in January,” says Calvyn Hamman, Senior Vice President of Sales and Marketing at Toyota South Africa Motors.
Hamman refers to the general practice of many new vehicle owners and some vehicle brands to suspend vehicle registration in December and register it in the new model year. This leads to a drop in recorded sales in December and a jump in sales in January.
“We expect that the market in 2014 will stagnate at 2013 levels or even drop somewhat and the first month’s sales is evidence of this,” says Hamman. “This is due in part to the underlying economic drivers, such as increasing inflation, a weakening rand and growing consumer debt. The recent interest rate increase, albeit small, sent a further negative signal to customers.”
Vehicle rental purchases, at 7 154 units or 13.4% of overall sales provided an unseasonal boost to vehicle sales, while retail level sales – a barometer of private buyers’ economic reality – represented 80.9% of all vehicles sold. In December private purchases represented 82% of all sales.
January sales and production figures were also influenced by production changes on certain high volume models. For Toyota the preparations for the new Toyota Corolla, set for local sale from early in March, meant that the 1 110 units sold in January were not a true reflection of market demand for Corolla.
Other manufacturers switched model lines and the subsequent drop in production influenced total vehicle exports, which dropped by 19.7% over the same month in 2013.
“Despite the lower expectations of sales in 2014 we should keep in mind that January’s retail sales’ levels are still higher or similar to the market peak in 2007. We expect that the market will maintain these levels or decline somewhat during the rest of the year as vehicle prices adjust to the weakening rand and customers change purchasing behaviour in reaction to the increasing cost of debt,” says Hamman.