New vehicle sales strengthen in early 2025

New vehicle sales in February 2025 (47 911 units) were 7.1% up on February 2024, according to naamsa, and 2.0% more than January, and Lightstone anticipates 2025 sales will increase by around 5% from 2024, well above last year’s -3% growth, the weakest annual sales figures in three years.

The current strength in the market follows a period of domestic economic uncertainty surrounding the national elections at the end of May last year, allied to interest rates which were at a 15-year high for most of 2024. The reduction in interest rates towards the end of 2024 buoyed the demand for new vehicles, although the proposed increase in VAT could temper this.

Passenger vehicle sales climbed 16.6% year-on-year in February to 33 707 units, but Light Commercial Vehicles sales fell by 11.5%, reaching 11 784 units, when compared with February 2024.

New vehicle sales

Overall sales for the first two months of 2025 were 9.4% higher than in 2024, and 7.4% above sales for the same window in 2023.

naamsa reported 94 899 units sold between January and February, of which around 85.8% represented dealer sales. Passenger vehicle sales were up 18.5% year-on-year for the two months and sales of LCVs declined 10.4% compared to 2024. The car rental industry accounted for around 17.2% of new Passenger car sales in the January-February window, ahead of the 14.3% share in the 2024 window and the 15.2% in 2023.

January to February – Passenger and Light Commercial new vehicle sales

Lightstone currently anticipates the market to grow in 2025, although pressures remain throughout the macroeconomic environment, both locally and globally, which could affect sales as the year progresses. Domestic GDP is expected to grow at 1.7% in 2025, after coming in at 0.6% in 2024. The Rand is holding reasonably steady against major global currencies and headline consumer inflation is expected to remain within the Reserve Bank’s 3% - 6% target range.

And some good news for auto sales - the Monetary Policy Committee of the Reserve Bank has cut interest rates by 25 basis points at three of its last four meetings, and there is a widely held view there could be a further 25-point reduction before the end of the year.

Anticipated new vehicle sales for 2025 sit at around 541 000 units, of which 509 500 are Light Vehicles (Passenger and Light Commercial). Overall, growth in new vehicle sales is expected to end 2025 in the region of 5%, well above the -3% growth in new vehicle sales in 2024, the weakest annual sales figures in three years.

New vehicle sales – 2020 to 2025

Market observations - bodyshape

The Crossover/SUV bodyshape (which includes the Chery Tiggo 4 Pro, Haval Jolion and Toyota Corolla Cross) was the best-selling Light Vehicle (Passenger & LCV markets) bodyshape in South Africa in the first two months of 2025, with 38 305 new units sold (86.3% were Dealer sales, and 7.6% reported through the Rental channel).

Sales in this category were up 29% from the same window in 2024, and its 42.3% share of all Light Vehicle sales for the January-February window was higher than the 36.1% recorded for the same period in 2024.

The second-best performing bodyshape in terms of volume was the Hatch (which includes Suzuki Swift, Toyota Starlet and VW Polo Vivo) with 24 468 units sold between January and February. As with the Crossover/SUV bodyshape, sales were up, by 13.9%, compared to the same window in 2024.

Sales for the Panel Van bodyshape, which includes the Suzuki Eeco, Toyota Quantum and Volkswagen Caddy, picked up 75.3% year-on-year in the January-February period from 2024, which in turn was 41.2% up on 2023. This makes the Panel Van bodyshape the best performing Light Vehicle segment in terms of sales growth, despite not being one of the bigger segments. Over the first two months of 2025, the Panel Van bodyshape made up 1.5% of all Light Vehicle sales, up from 1% market share in 2024.

The second most improved bodyshape for year-on-year growth over the first two months of 2024 was the Crossover/SUV category.

Light Vehicle Bodyshapes – share of Light Vehicle market (January to February)

Hybrid and Electric vehicle sales

Year-on-year growth in new Hybrid and Electric Passenger vehicle sales (which includes Traditional Hybrid, Plug-in Hybrid and Battery Electric vehicles) for the first two months of 2025 was up just 6%, at 2 159 units, on 2024, which in turn had jumped 72% from 2023. The full Passenger Market share for these vehicles was 3.1% for the first two months of 2025.

January to February – Hybrid and Electric Vehicle share of Passenger sales

Traditional Hybrid vehicles contributed 86% of the sales of the sub-segment over the first two months of 2025, with Battery Electric vehicles making up 6% of sales and Plug-in Hybrid vehicles responsible for 8%.

Vehicle Price Inflation

New Light Vehicle price inflation in South Africa rose 1.7% year-on-year (y-o-y) in January 2025 (2024:2.3%), a thirteenth successive month where new vehicle price inflation has come in below Headline CPI of 3.2% (as released by StatsSA). On a monthly basis, January prices dipped 1.4% from December, which in turn was 0.8% up on November.

Lightstone’s New Light Vehicle Price Inflation vs Headline Consumer Price Inflation

Used Passenger Vehicle inflation y-o-y for 2-year-old vehicles was -1.5% at the end of February (meaning that, on average, a 2-year-old Passenger car was retaining 1.5% less of its original value in February 2025 than a 2-year-old car was a year ago).

This was unchanged from January (-1.5%), but a marginal improvement over February 2024 (-1.6%).

For 4-year-old vehicles, inflation was -2.1% y-o-y in February, up from January (-2.2%) and -2.3% in February last year. A 6-year-old Passenger vehicle retained 1.9% less of its value in February 2025 than in February 2024. This was an improvement on the January figure of -2.1%, as well as the February 2024 inflation which was also -2.1% y-o-y.