South African Auto Market Adapts to Economic Challenges with Strong Used Vehicle Demand and Rising EV Interest
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GUEST - Marcia Mayaba, Sales Vice President: Auto Information Services at TransUnion South Africa
TransUnion's latest Vehicle Pricing Index (VPI) for Q2 2024, which integrates alternative data and several market-leading sources, shows a 6% decline in new vehicle sales and a 6.1% drop in total vehicles financed from the previous quarter.
Despite this, the market is showing signs of resilience, with a slight increase in consumer confidence and positive trends in generational shifts toward vehicle financing. The used-to-new ratio of financed vehicles moved to 1.44, up from the 1.15 of Q1 2024. This indicates a growing consumer preference for used vehicles. This preference comes at a time when used vehicle prices have risen by just 0.6% year-over-year (YoY), well below the rate of inflation. Over the same period, new vehicle prices rose by 4.4%, suggesting the market is under strain and that affordability remains a priority.
TransUnion's latest Vehicle Pricing Index (VPI) for Q2 2024, which integrates alternative data and several market-leading sources, shows a 6% decline in new vehicle sales and a 6.1% drop in total vehicles financed from the previous quarter.
Despite this, the market is showing signs of resilience, with a slight increase in consumer confidence and positive trends in generational shifts toward vehicle financing. The used-to-new ratio of financed vehicles moved to 1.44, up from the 1.15 of Q1 2024. This indicates a growing consumer preference for used vehicles. This preference comes at a time when used vehicle prices have risen by just 0.6% year-over-year (YoY), well below the rate of inflation. Over the same period, new vehicle prices rose by 4.4%, suggesting the market is under strain and that affordability remains a priority.