Derrick
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From the Sunday Times:
Forget it guys, women decide what car you will drive. Research by online group Cars4women has shown that more than 80% of decision-making on what car is bought is made by the wife or girlfriend.
Women need to be treated as serious buyers, said the editor of Cars4women, Sasha Wyatt-Minter.
“What women want” should be the slogan at every dealership because women say yea or nay when it comes to signing on the dotted line, she said.
Women have been complaining for years about how they are treated at car dealerships — with salespeople generally engaging only the man in conversation and offering him the test drive.
But women are making informed choices, conducting shrewd deals and are major contributors to vehicle sales, she said.
The most popular cars for women are those costing less than R100 000.
But car dealers are feeling the pinch because of high interest rates and tighter credit laws and many face the prospect of closing down or consolidating with a resultant lay-off of staff.
Darryl Jacobson, managing director of vehicle auctioneer Burchmore’s, said members of the growing emerging market, or “black diamonds”, were now looking at the premium sector of the used car market. He says black buyers now make up 90% of sales at Burchmore’s.
“They see a car as a tool to communicate a message that they have made it. So they don’t want a cheap runabout, they want an impressive premium car,” said Jacobson.
“We are seeing considerable demand for ostentatious cars, for vehicles that impress the casual observer. It is clear that these buyers have one goal: they want to make a statement.”
Brand Pretorius, chairman of McCarthy Motor Holdings (a subsidiary of Bidvest), said motor industry analysts have identified a trend called “rocketing”. When black buyers move from lower to higher income levels they tend to spend their money on products that show they have arrived, he said.
“The categories are fancy cars, fashionable branded clothing and expensive liquor, but less on items such as insurance, healthcare and sometimes housing.”
Dealer sales, however, remain on the decline and are under pressure from rising inflation and interest rates, said Mike Glendinning, sales and marketing director at Volkswagen.
Jeff Osborne, chief executive of the Retail Motor Industry Organisation, said figures for the first 10 months of the year showed that sales were 8.6% lower than in the same period last year. A further increase in interest rates in December, which is expected by analysts, would put dealers under even more pressure.
Osborne said sales were likely to remain low until well into 2008. With nearly two million cars sold in the past four years, and in the face of tightening financial restrictions, most motorists will decide to keep their cars longer than they would normally do.
In Osborne’s view, the tough trading conditions in both the new and used sectors will continue next year — an exception being the heavy truck sector, where sales will continue to increase.
Another problem facing dealers is the number of “hot” cars being sold. Mike von Höne, solutions executive at Trans-Union Auto Information Services, said the number of stole cars being marketed is on the increase.
In the first six months of this year, Trans- Union found that 4.1% of vehicles inquired about had a police record — compared with 3.9% last year.
“Because some dealers don’t conduct a vehicle inquiry for every vehicle — our records show that inquiries were made on less than a quarter of all used vehicles sold by dealers last year — there is no accurate way to ascertain the precise number of hot cars that find their way into the market.”
Through its database, TransUnion can ascertain if a car is properly registered, if there are security alerts on it, if it is financially encumbered, if it is illegally in SA and whether there is any police interest in it.
Meanwhile, the flood of Chinese bakkies into the SA market is having a major impact on the second-hand market for light commercial vehicles (LCVs), according to Burchmore’s Jacobson.
Many buyers are now abandoning Japanese LCVs and switching to cheaper Chinese vehicles.
“The used car market is already under major pressure; the last thing it needs is yet another negative factor,” he said.
This trend was confirmed by McCarthy’s Pretorius, who said that Chinese bakkies were competing with three- to four-year-old Japanese LCVs.
“These Chinese vehicles are having an impact, especially when it comes to small businesses with limited capital or even companies which are buying LCVs for specific fleet applications.”
Generally, owner-driver buyers are still opting for used Japanese bakkies, the exception being small, start-up businesses with financial pressure, which are also favouring Chinese LCVs.
Pretorius believes, however, that the used car market will not be affected as the cost of transporting a car from China to South Africa could be R8000 to R10000, plus full import duty, of 30%, while all local manufacturers have the benefit of export credits that allow them to import vehicles at reduced costs.
“While the Chinese have certainly intensified competition in the lower end of the LCV market, I don’t think this will be replicated in the car market.”
Forget it guys, women decide what car you will drive. Research by online group Cars4women has shown that more than 80% of decision-making on what car is bought is made by the wife or girlfriend.
Women need to be treated as serious buyers, said the editor of Cars4women, Sasha Wyatt-Minter.
“What women want” should be the slogan at every dealership because women say yea or nay when it comes to signing on the dotted line, she said.
Women have been complaining for years about how they are treated at car dealerships — with salespeople generally engaging only the man in conversation and offering him the test drive.
But women are making informed choices, conducting shrewd deals and are major contributors to vehicle sales, she said.
The most popular cars for women are those costing less than R100 000.
But car dealers are feeling the pinch because of high interest rates and tighter credit laws and many face the prospect of closing down or consolidating with a resultant lay-off of staff.
Darryl Jacobson, managing director of vehicle auctioneer Burchmore’s, said members of the growing emerging market, or “black diamonds”, were now looking at the premium sector of the used car market. He says black buyers now make up 90% of sales at Burchmore’s.
“They see a car as a tool to communicate a message that they have made it. So they don’t want a cheap runabout, they want an impressive premium car,” said Jacobson.
“We are seeing considerable demand for ostentatious cars, for vehicles that impress the casual observer. It is clear that these buyers have one goal: they want to make a statement.”
Brand Pretorius, chairman of McCarthy Motor Holdings (a subsidiary of Bidvest), said motor industry analysts have identified a trend called “rocketing”. When black buyers move from lower to higher income levels they tend to spend their money on products that show they have arrived, he said.
“The categories are fancy cars, fashionable branded clothing and expensive liquor, but less on items such as insurance, healthcare and sometimes housing.”
Dealer sales, however, remain on the decline and are under pressure from rising inflation and interest rates, said Mike Glendinning, sales and marketing director at Volkswagen.
Jeff Osborne, chief executive of the Retail Motor Industry Organisation, said figures for the first 10 months of the year showed that sales were 8.6% lower than in the same period last year. A further increase in interest rates in December, which is expected by analysts, would put dealers under even more pressure.
Osborne said sales were likely to remain low until well into 2008. With nearly two million cars sold in the past four years, and in the face of tightening financial restrictions, most motorists will decide to keep their cars longer than they would normally do.
In Osborne’s view, the tough trading conditions in both the new and used sectors will continue next year — an exception being the heavy truck sector, where sales will continue to increase.
Another problem facing dealers is the number of “hot” cars being sold. Mike von Höne, solutions executive at Trans-Union Auto Information Services, said the number of stole cars being marketed is on the increase.
In the first six months of this year, Trans- Union found that 4.1% of vehicles inquired about had a police record — compared with 3.9% last year.
“Because some dealers don’t conduct a vehicle inquiry for every vehicle — our records show that inquiries were made on less than a quarter of all used vehicles sold by dealers last year — there is no accurate way to ascertain the precise number of hot cars that find their way into the market.”
Through its database, TransUnion can ascertain if a car is properly registered, if there are security alerts on it, if it is financially encumbered, if it is illegally in SA and whether there is any police interest in it.
Meanwhile, the flood of Chinese bakkies into the SA market is having a major impact on the second-hand market for light commercial vehicles (LCVs), according to Burchmore’s Jacobson.
Many buyers are now abandoning Japanese LCVs and switching to cheaper Chinese vehicles.
“The used car market is already under major pressure; the last thing it needs is yet another negative factor,” he said.
This trend was confirmed by McCarthy’s Pretorius, who said that Chinese bakkies were competing with three- to four-year-old Japanese LCVs.
“These Chinese vehicles are having an impact, especially when it comes to small businesses with limited capital or even companies which are buying LCVs for specific fleet applications.”
Generally, owner-driver buyers are still opting for used Japanese bakkies, the exception being small, start-up businesses with financial pressure, which are also favouring Chinese LCVs.
Pretorius believes, however, that the used car market will not be affected as the cost of transporting a car from China to South Africa could be R8000 to R10000, plus full import duty, of 30%, while all local manufacturers have the benefit of export credits that allow them to import vehicles at reduced costs.
“While the Chinese have certainly intensified competition in the lower end of the LCV market, I don’t think this will be replicated in the car market.”