This is the predication from the National Association of Automobile Manufacturers of SA (NAAMSA) on the release of the motor sales figures for November 2003.

Vehicle sales powered ahead showing an 11% rise to 31 538, albeit that October’s overall figure was nine per cent higher. NAAMSA also expects total vehicle sales to rise at least five per cent for the full year compared to 2002.

"Looking ahead to 2004, the combination of an expanding economy, improved business confidence, lower interest rates and, importantly, stable new vehicle prices represent a catalyst for above-average growth in new vehicle sales.

At this stage, double-digit growth in industry sales volumes for 2004 appears a distinct possibility," says NAAMSA.

Econometrix comments that the real star sector was heavy trucks and buses with a rise in sales of 34% in November compared to the same period for the last year.

"While price rises of one to two per cent are expected in January, this is not likely to put the potential buyer off his stride," says Econometrix. This price increase is seen by McCarthy as been "very modest for the second year in succession."

The NAAMSA figures also show that vehicle exports in 2003 caught up with the previous year’s levels, after a slow start.

Automotive sector leader Zola Tshefu comments:
We are hoping for more growth in the local market in 2004. Therefore, the current buoyant sales are welcome. The growth in local market has a direct positive impact on the Eastern Cape industry as almost 40% of local vehicle production is from our province. However, with slower economic growth predicted, the likelihood of that becoming a trend are slim, despite lower interest rates having a positive short-term impact on car sales.

Continuous growth in the local market and the resultant growth in local assembly will enhance the attractiveness of South Africa for component manufacturers. The size of the local market is always an issue with potential component manufacturing investors. Growth in the local market will mean an increase in the local content of vehicles produced in South Africa. This translates into more investment and jobs.