Heck, we’re an impatient lot. In many countries, car buyers are prepared to wait months for delivery of their new vehicle. Not South Africans. We want it now!
In days of yore, it was common for customers to complete the entire sale in a couple of hours — turn up at a dealership, select a vehicle, then drive it away after signing the purchase papers.
Today, legal requirements and tighter stockholding by dealers and car manufacturers make that impossible. In the past three years, a global shortage of automotive microchips and other components, combined with the collapse of global supply chains because of Covid and the war in Ukraine, has extended the delivery wait.
Ryan Robinson, global head of automotive research for the Deloitte consultancy group, says customers elsewhere have become used to — and accepting of — twiddling their thumbs for up to three months, even on popular car models. On limited-volume and personalised cars, it can be much longer.
Try telling that to South Africans. A Deloitte study shows that 32% expect delivery within seven days. Extend that to two weeks, and the figure rises to 71%. Only 9% are willing to wait more than a month.
Robinson was speaking this week at the launch of a Deloitte study of South African car-buying behaviour. It is part of an international study, based on input from 26,000 respondents around the world.
How do we make vehicle purchase more affordable when many people’s income is highly depressed?
— Lee Naik
Economic stress and the quest for affordability in South Africa are driving a trend towards cheaper vehicles. In a separate Deloitte automotive survey, 25% of local respondents say they are worried about paying upcoming household bills, 69% fear their savings are inadequate, 39% are concerned about their credit card bills and 54% say they are delaying large purchases, like cars. Deloitte Africa auto leader Ravin Sanjith says “financial anxiety” is rife.
Lee Naik, CEO of automotive data analytics specialist TransUnion Africa, says the average South African consumer is heavily indebted. Many families who used to run two cars are down to one. “How do we make vehicle purchase more affordable when many people’s income is highly depressed?” he asks.
Despite these pressures, South African respondents to Deloitte’s car-buying study say price is not a major reason for choosing a car. Despite evidence to the contrary in the overall market, only 39% say it is a defining factor. Top of the list is product quality, cited by 75%, followed by vehicle features and performance.
Brand affiliation — another way of saying brand loyalty — gets only 11% support. That’s a worrying statistic for branding and advertising agencies paid handsomely to persuade consumers of their client brands’ innate superiority. Manufacturers may also be concerned that even good sales and service by their current dealer won’t necessarily keep existing customers with the brand. It’s all about getting the best deal.
Attitudes to electric vehicles (EVs) reflect those in other studies. People would like to buy them eventually but not yet. Of the Deloitte sample, 74% say their next vehicle will be powered by a petrol or diesel internal combustion engine (ICE). Encouragingly for the EV lobby, that’s down from 84% a year ago. There is a swing towards hybrid vehicles with dual ICE and battery-electric motors — both those that need occasional external recharging and those that regenerate power internally. But support for all-electric vehicles wholly dependent on plug-in charging remains stuck on 2%.
The biggest obstacles to plug-ins are the perceived paucity of EV charging stations around South Africa and the time it takes to charge. The higher cost of EVs compared to ICE cars is also a major concern, though not to some hopefuls.
Of those intending to buy an EV as their next car, 21% hope to pay less than R200,000. That’s a very, very tall order.
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