Financial Mail and Business Day

AN UNPRECEDENTED OPERATIONAL ENVIRONMENT IS REDEFINING THE PERFORMANCE OF THE INDUSTRY

Mikel Mabasa Naamsa CEO

“An unprecedented operational environment is redefining the performance of the automotive industry, with record high externalities for decades. These ongoing negative domestic and global economic activities directly affect the production mechanisms of the industry and therefore the cost of doing business in SA,” Mabasa said.

The 10th successive interest rate hike announcement by the Reserve Bank was cause for concern, he said.

“For the first time, inconsistent with emerging market currencies, the rand went into a free flow mode to record lows. To top it all, by May 9, SA had been in the dark for as long as the entirety of 2022. To date, South Africans have spent 27% of the year without power compared to 9.5% of 2022 and the situation is likely to get worse.

An economy restricted by load-shedding “will cause irreparable harm to the automotive industry which has become the successful cornerstone of industrialisation and development in SA.

“For SA, the risks are heavily tilted downwards, especially as debt levels continue to grow to record high levels. The likelihood of further monetary tightening is high as inflation remains stickier than expected. On geopolitical issues, the vehicle export performance continues to be affected by stagflation shocks, amplified by the protracted Russia/Ukraine conflict.”

Toyota maintained its position as SA’s favourite brand in May with 11,395 sales, ahead of Volkswagen (5,259), Suzuki Auto (3,709), Hyundai (2,745), Ford (2,491), Nissan (2,314), Haval (1,877), Isuzu (1,871), Renault (1,848), Kia (1,668), BMW (1,228), Chery (1,211), Mahindra (907), Mercedes-Benz (692) and Daimler Truck (455) rounding out the top 15.

NATIONAL

en-za

2023-06-02T07:00:00.0000000Z

2023-06-02T07:00:00.0000000Z

https://bd.pressreader.com/article/281573770080627

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