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Bumpy road ahead for vehicle sales
- Thread starter NarrowBandFtw
- Start date
NarrowBandFtw
Honorary Master
Honest question: has anyone here ever in their lives seen new car prices in ZA drop even by a few cents?
It seems mind boggling that the economy is in the crapper, they predict "negative growth" in new car sales (you know because saying a drop is not PC) and the main concern is that price increases won't be easily absorbed?!? :wtf:
Here's an introduction to basic economics 101 car industry: supply and demand, when the demand for your stuff drops, you have an oversupply and need to drop the damn price!
It seems mind boggling that the economy is in the crapper, they predict "negative growth" in new car sales (you know because saying a drop is not PC) and the main concern is that price increases won't be easily absorbed?!? :wtf:
Here's an introduction to basic economics 101 car industry: supply and demand, when the demand for your stuff drops, you have an oversupply and need to drop the damn price!
reactor_sa
Executive Member
South Africans will be eating bread and palony before trading their BMW for something more affordable. We already know they are happy to park their BMW outside their low cost housing.
Messugga
Honorary Master
Golf R went up by something like R50k on 1 Jan. Car prices are already stupidly ridiculous. If it weren't for residuals, many (most?) people simply wouldn't be able to "afford" the cars they currently drive.
supersunbird
Honorary Master
Nah, they easily export the stuff, demand is there, just not locally...
ozziej
Senior Member
Well, until they get proper transport infrastructure : bus, train, gautrain, etc, we will still have to buy cars.
At the same time, I really don't have any sympathy for the car manufacturers. They have been ripping us off for ages. Like a few have said, every time there is a change in the rand, its always an excuse to bump prices up. I've never seen prices come down. Its the SA way. When times are tough, up the prices to make even fewer people buy. Seems like everyone in this country that sells products has failed economics. If you want to attract new business, either you need to have a differentiator. So, usually price is the easiest, but also things like : better warranties, additional features are other examples.
At the same time, I really don't have any sympathy for the car manufacturers. They have been ripping us off for ages. Like a few have said, every time there is a change in the rand, its always an excuse to bump prices up. I've never seen prices come down. Its the SA way. When times are tough, up the prices to make even fewer people buy. Seems like everyone in this country that sells products has failed economics. If you want to attract new business, either you need to have a differentiator. So, usually price is the easiest, but also things like : better warranties, additional features are other examples.
NarrowBandFtw
Honorary Master
And yet prices just never, ever, come down even by a slight margin. Prices sure are ridiculous though, bought my current car used 5 years ago for 350k, that very same model, mileage and age car right now used is 450k not to mention the shyte trade-in offer I get on the old car. Every December, like clockwork, I get the email from the dealer "hurry up and buy now at the old price before it goes up in January!"
Car sales down? Please, cry me a river! I started 2016 by extending the motorplan for another year and settling the car loan entirely. I'm out of this game where half a bar is the minimum entry requirement to get a decent car.
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Messugga
Honorary Master
I'm in the same boat. Wouldn't mind a new car - something more practical than what I have like a sedan or SUV - but you're looking in excess of R500k for anything German with good spec. And then you look at depreciation on something like a 320d. Couple hundred k in the space of a year.
NarrowBandFtw
Honorary Master
Not so sure, global demand has dropped, take for example Australia which is the biggest buyer of our locally manufactured and exported 3-series BMW (I think this is still true).
Demand is dropping across the board in most segments: http://www.caradvice.com.au/400905/new-car-sales-figures-november-2015/
In November 2015 the segment with the 3-series dropped 11.8% compared to the year before.
For some inexplicable reason though (well ok I blame MIDP and its successor APDP) you can sometimes see prices drop overseas, but never here.
deweyzeph
Honorary Master
The problem is that the South African government bans the import of used second-hand vehicles (except for cases where you can prove you've owned the vehicle overseas for a year). While this obviously is meant to protect the car industry in SA, it really is not very consumer friendly.