- Only 515 000 vehicles will sold in 2020
- SA GDP will grow by only 0.6% in 2020
- Still a lot of policy uncertainty
JOHANNESBURG, South Africa – Tough times are ahead through 2020 for what used to be a booming South African automotive industry and, worse, at least one expert says the trend is likely to continue past next Christmas.
Andrew Kirby, president and CEO of Toyota South Africa, told the January 2020 State of the Motor Industry conference he believed total vehicle sales for 2020 would continue on a downward trajectory that began in 2013 to settle at 515 000 by year end..
Of the total forecast, Kirby estimated that 339 900 would be cars, 150 585 light commercials, the remaining 7880 and 16 635 would respectively be medium and heavy commercial vehicles. Kirby shared his forecast while chairing TSAM’s third instalment of the State of the Motor Industry (SOMI) address at Kylami n January 30, 2020.
‘THE HOUSE IS DIRTY’
Ettienne le Roux, chief economist at Rand Merchant Bank, added: “Consumer confidence has been low through the past two or three years, spending conservative. This will affect local vehicle sales because buying a car is considered discretionary spending. Finances are really tight, the pressure consumers are feeling is significant…”
Dr Thabi Leoka, an independent economist who also sits on president Cyril Ramaphosa’s Economic Advisory Panel, says the current South African socio-political landscape is not conducive to attracting investment. Referring to socio-political problems, she asserted: “The house internally is dirty. You are going out to the world to invite investors to come and eat in this house of chaos… we need to focus on cleaning the house first.”
Toyota reportedly expects consumer spending to fall through 2020 but was cautiously optimistic about achieving a competitive market share during the year. Leon Theron, TSAM’s sales boss, explained that his corporate strategy involved galvanising Toyota’s dealer channel, enhancing Lexus and Toyota hybrids, and taking a robust marketing approach for the Corolla nameplate.