July 2023 | BUSINESS FLEET AFRICA
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Reuben van Niekerk
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Power shift
While the South African economic outlook remains dismal, evidence
or resilience is amazingly being seen in the transport and related in-
dustries. Production figures in the mining and manufacturing sectors
for example have been surprising despite heavy load-shedding during the first part of 2023,
suggesting that these industries are becoming progressively more resilient to the effects of
load-shedding, as companies reduce their energy dependence on an embattled Eskom. I think
we may have reached a turning point as companies, industry and private individuals have
realised that they need to be self-sustaining. These investments in personal infrastructure
will take the load off the badly maintained infrastructure and with many having made those
investments the effects of load shedding could start to have less of an effect on the economy.
Vehicle market continues to outperform expectations
A consistent stream of new and updated models, particularly in significant high-volume
segments, along with improved availability of popular models, are proving to be crucial factors
in sustaining the growth trajectory of new vehicle sales in South Africa.
The total market reached 46 810 units in June, which is 14% better than the same month
last year. Witnessing continued growth in the current challenging economic environment is
encouraging, given that vehicle buyers are facing affordability pressures, a depreciating rand
that drives prices higher, low business confidence and political instability.
Rental sales made up 10% of total sales and 13,4% of passenger car sales, indicating
good activity in the car rental space as providers start to bolster their fleets for the July and
December holidays.
Logistics industry continues to recover
The overall SA logistics industry as measured by the Ctrack Transport and Freight Index also
showed good performance with the majority of the sub sectors improving resulting in the in-
dex reaching its highest level yet. The only non-performing sector continues to be Rail Freight
but I am afraid that may be a lost cause. Statistics SA has tracked the ratio between rail and
road freight of total freight payload being transported and from a ratio of 75.1% in 2017, road
freight as a percentage of total freight being transported, has gradually improved to 84.4% in
2022. This is good news for heavy commercial vehicle suppliers and all their related industries
as the demand will only continue to improve.
Contributing positively to SA’s GDP
The transport industry was among the top three sectoral performers in the first quarter of
2023, increasing by 1.1% compared to the previous quarter seasonally adjusted (vs. 0.4% for
total economy), contributing positively to the overall economic performance of the South
African economy.
Reuben van Niekerk
Editor
Editorial
EDITORIAL
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