New vehicle sales may be thriving, but local production is not. Figures released this week show that 61,071 cars and commercial vehicles were sold last month — a 12.8% improvement on the 45,287 of May 2025. After five months of 2026, aggregate sales have improved by 12.5% compared to a year earlier, from 231,886 to 260,909.
The figures come from motor industry association Naamsa, which represents vehicle manufacturers and importers. In its latest quarterly review, however, it reveals that production of South Africa-made vehicles fell by 5.5% in the first three months of 2026, from 145,660 to 137,911.
Though Naamsa hopes production will improve later this year, the January-March numbers underline the challenge that local car and bakkie manufacturers, in particular, face from a flood of imports.
Business Day reported this week that trade, industry & competition minister Parks Tau, in a written parliamentary answer, said the government expects to conclude its review of automotive policy by September and implement changes by year-end.
Since early last year, the industry has been begging Tau to overhaul the 2021-2035 automotive production & development programme (APDP) and umbrella South African automotive masterplan to meet manufacturing and trading conditions that have changed almost beyond recognition since the policies were announced in 2018.
Covid turned plans upside down, but policy planners also did not anticipate the scale of the global shift towards electric vehicles (EVs). About 70% of locally made vehicles are exported, most to markets that plan to outlaw the sale of new petrol and diesel vehicles over the next decade.
Nor did they expect the surge of Chinese and Indian imports into the local market. Chinese companies, in particular, have been accused of “dumping” vehicles in South Africa — something they strongly reject. The government has said it will consider anti-dumping penalties if accusations are proved.
Among the measures requested by manufacturers are stronger incentives to encourage the local production and sale of EVs, a policy to encourage the local beneficiation of raw materials used to make EV batteries, higher tariffs on imported cars and bakkies, and a change in APDP rules so that manufacturers can use production incentives to directly reduce vehicle prices.
The challenge for the remainder of the year will be whether consumers can continue to absorb higher financing costs and rising living expenses
— Brandon Cohen
May’s new vehicle sales once again highlight the challenge facing the local industry. Toyota, as usual, is the clear market leader with 10,667 sales of cars and commercial vehicles, though its 20% share is short of its customary 24%.
Next comes importer Suzuki (5,546), followed by local manufacturer Volkswagen (5,295), importer Hyundai (3,054) and local company Ford (2,932). The next local producer is Isuzu, with 1,371, but it is five places behind Ford, separated by the Chinese trio of Great Wall Motors, Chery and Jetour and Indian company Mahindra, which assembles vehicles here from imported kits.
Chery, which has bought Nissan’s South African plant and plans to start vehicle assembly there in 2027, is the parent company of Jetour, as well as two other Chinese brands, Omoda and Jaecoo. If their May sales were added together, the resulting 5,958 would make Chery the second biggest-selling auto group in South Africa.
Brandon Cohen, chair of the National Automobile Dealers’ Association, says May’s new vehicle sales — the best May performance since 2013 — continue to confound market predictions.
He says: “Given the recent interest rate increase, ongoing cost of living pressures and concerns around consumer affordability, many expected vehicle demand to come under greater pressure. Instead, the market continues to show surprising resilience.
“The challenge for the remainder of the year will be whether consumers can continue to absorb higher financing costs and rising living expenses.”
It’s a point reinforced by Naamsa, particularly after last week’s rise in interest rates and continuing pressure on fuel prices. It notes that in April (the most recent month for which comparative figures are available), EV sales rose by 120% from a year earlier, reflecting the desire for lower running costs.
Naamsa observes: “For [vehicle buyers], implications extend beyond borrowing costs alone. Higher fuel prices increase the ongoing cost of vehicle ownership, while higher interest rates raise the cost of vehicle acquisition. This combination creates a dual affordability challenge that is likely to weigh most heavily on first-time vehicle buyers, small business operators and segments of the market where purchasing decisions are particularly sensitive to monthly repayment obligations and operating costs.”
These issues, allied to inflation and growing global uncertainty, “could begin to erode consumer and business confidence, placing pressure on discretionary spending and investment decisions”, Naamsa adds.
Vehicle exports, meanwhile, continue to lose ground. Last month, 29,392 vehicles were exported — 4.8% fewer than the 30,859 of May 2025. In the first five months of this year, 147,875 were shipped out. That was down 8% on the 160,703 over the corresponding period of 2025.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.