South Africa’s new vehicle market maintained its strong momentum in July, with almost 85% of all vehicles sold during the month being retailed through dealerships. The results point to improving consumer confidence, with broad-based growth across all major vehicle segments driven primarily by retail demand. Against a backdrop of stable interest rates, easing petrol costs and value-conscious purchasing decisions, dealerships continue to underpin the resilience of South Africa’s automotive industry.
Total new vehicle sales reached 57,708 units in July, an increase of 11.9% compared with the same month last year. Passenger vehicle sales rose by 12.5% to 40,912 units, the strongest monthly passenger car performance since September 2014, while light commercial vehicle sales increased by 10.6% to 13,710 units.
“The July results clearly indicate that consumer confidence is improving,” said Brandon Cohen, Chairperson of NADA. “With 84,8% of all new vehicles sold during July being retailed through dealerships, these figures are an outstanding endorsement of the resilience of South African consumers and the strength of the retail motor industry. Consumers are once again prepared to invest in their mobility when the right value, affordability and finance solutions come together, and dealerships across the country are seeing that confidence translate into showroom activity.”
The South African Reserve Bank’s recent decision to leave interest rates unchanged has provided consumers with greater certainty around their monthly financial commitments. The latest reduction in petrol prices will also provide welcome relief to motorists, although higher diesel prices will continue to place pressure on transport operators and businesses.
From a dealership perspective, affordability remains central to every purchasing decision. Rather than delaying purchases indefinitely, consumers are carefully weighing purchase price, fuel efficiency, finance costs and long-term ownership expenses before making their choice.
Many are adapting by considering different vehicle segments and working with dealers to structure finance solutions that best suit their budgets.
Dealerships are also reporting increased activity in the pre-owned market, with stronger customer enquiries, finance applications and deal conversions during July. Consumers are increasingly exploring both new and pre-owned vehicles to maximise value, while dealers are beginning to see growing interest in pre-owned Chinese brands as an affordable alternative. At the same time, new Chinese vehicles continue to attract buyers seeking modern features at competitive prices.
“Today’s customer is exceptionally well informed and focused on value,” Cohen said. “Dealerships have responded by offering a broader range of products and flexible finance solutions that make vehicle ownership more accessible. Whether customers choose new or pre-owned vehicles, dealers are helping them find the option that best meets their needs and budget.”
The commercial vehicle market also delivered encouraging results during July. Medium commercial vehicle sales increased by 19.4%, recording their strongest monthly performance since March 2023, while heavy commercial vehicle sales grew by 16.4% and extra-heavy commercial vehicles improved by 7.9%.
“Commercial vehicle purchasing is often one of the earliest indicators of business activity,” said Martin van den Berg, NADA Commercial Vehicle Executive. “The trends dealers are seeing are encouraging. Investment in distribution fleets, construction vehicles and freight capacity suggests that many businesses are planning ahead with confidence. While it is too early to call it a broad-based recovery, these are positive signals from sectors that typically invest ahead of growth.”
Dealers are reporting increased demand for distribution vehicles as businesses prepare for the year-end trading period, while stronger sales of vocational vehicles, including tippers, suggest improving activity in construction and infrastructure. Continued growth in the heavy and extra-heavy commercial vehicle segments reinforces the view that logistics, freight and distribution operators remain committed to investing in productivity and fleet renewal.
“South African dealerships continue to underpin the resilience of the automotive industry. Consumers are responding positively to greater certainty around interest rates, improving affordability and the value being offered by dealers. While challenges remain, July’s results give us growing confidence that this positive momentum can be sustained through the second half of the year.” Cohen concluded.
