New data from consumer credit reporting agency TransUnion shows that it is cheaper to buy a new car in South Africa right now – despite a multitude of global and local factors placing pressure on the sector and consumers.
The group’s latest Vehicle Price Index – which effectively measures the inflation rate for new vehicles – shows that new vehicle pricing decreased from 8.8% in Q1 2021 to 4% in Q1 2022. This means that new vehicle costs are still below inflation, although this is forecast to increase in the coming months.
The VPI measures the relationship between the increase in vehicle pricing for new and used vehicles from a basket of passenger vehicles which incorporates 15 top volume manufacturers. The index is created using vehicle sales data from across the industry. “South African interest rate and fuel hikes increased the total cost of ownership. Despite supply chain disruptions, volatility in oil prices, lack of quality used supply, imminent unemployment rate increases, negative exchange impact and further pressure on disposable income during the quarter, sales returned to normal levels.”
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