General Motors South Africa has reported sales of 3,437 new vehicles during January 2016. The results represent a decrease of 27 percent compared to the 4,367 units sold in January 2015.
By comparison, the overall industry was down 6.9 percent year-over-year, despite surprisingly high sales of rental vehicles, which accounted for one in four passenger vehicles sold during the month.
A key highlight for GMSA during the period was the locally-produced Chevrolet Spark, which sold 1,018 units.
The automaker cites the overall economic climate, including rising interest rates, inflation, and high levels of household debt, and warns that it expects declining sales volume throughout 2016.
“The January sales results are a clear indication that consumers are under pressure due to the increase in interest rates, general inflationary pressure, and high levels of household debt. We expect the NAAMSA new vehicle industry to show a continued decline in volume throughout 2016. This is evidenced in the dealer channel volumes. January saw a drop of 16% in passenger sales and 12% drop in Light Commercial sales, representing the lowest dealer volume since April 2011. We had expected a weaker January in the dealer channel, but this was even lower than our conservative expectations,” says Brian Olson, GMSA Vice President Vehicle Sales, Service and Marketing.
Moreover, the automaker expects to see a stronger used vehicle market in the near future.
“As the year progresses we expect to see a stronger used vehicle market as the pressure mounts on South African consumers. In January we saw a drop in new vehicle applications of 19% versus December whereas used vehicle applications were up 4%,” said Olson.
To note, GM South Africa markets the Chevrolet, Opel, and Isuzu brands. The latter is part of a unique arrangement with Isuzu that seems GM market the Isuzu KB pickup truck, which is closely related to the international-market Chevrolet Colorado/S10.