Toyota is faced with a backlog of between 600 and 700 new vehicles in Namibia, and is struggling to source new vehicles in a timely manner from global factories to satisfy rising demand in the country.
This comes as the brand dominated vehicle sales for March 2022 with a 47% share, followed by Volkswagen at 13.2%, Nissan 5.6%, Ford 4.4% and KIA at 4.2%.
“Disruptions to car production are expected to last until the second quarter of 2022, with management now expecting only marginal growth in vehicle deliveries. Globally carmakers have repeatedly left factories idle due to lack of adequate semiconductor supplies, leading to lower vehicle production. This continues to create a mismatch between supply and demand for new vehicles worldwide as demand has recovered, including Namibia,” Simonis Storm Economist, Theo Klein said.
Volkswagen, according to Klein, has indicated that ordering a new car with client specific accessories can take up to a year to arrive in Namibia.
“Local Touareg and Tiguan vehicles have parts components manufactured in Ukraine, which causes delays in imports for these models. Volkswagen will have price increases of between 2% and 2.5% every quarter for 2022 as a result of cost pressures in manufacturing,” he said.
The impact of import delays will only affect Mercedes in Q2 2022, as vehicles had already been built for Q1 2022 prior to the war in Ukraine.
“Mercedes had a 3% price increase on new vehicles during 1Q2022. Due to rising steel prices and shipping costs, various manufacturers have increased prices between 3% and 5% during 2Q2022. Parts prices have increased by up to 10% due to similar reasons,” he said.
Audi, said Klein, has made alternative arrangements as certain engines were produced in Russia and wiring harnesses for many models were produced in Ukraine.
“Restrictions on available models to order remain, with the impact on supply to Namibia being felt for four to six months on dealer sales level. Certain models have run out of stock locally and replacement models have significant delays. Audi had a 2% price increase across all models in 1Q 2022, with a larger price increase expected during 2Q2022. Audi extra heavy commercial trucks saw a 5% price increase in 1Q 2022 and a 3% increase in April 2022,” he said.
Namibian dealership stock allocation from global factories have been reduced by 20% for Ford during 1Q 2022.
“Ford Global distributes chips to their most lucrative markets, which lowers production for – and exports to – Southern Africa. Ford had new vehicle price increases of 3% in 1Q2022 and accessory price increases of 2% in 2Q 2022,” Klein added.
The Simonis Storm Economist has warned that Namibian consumers can expect car prices to continue rising in 2022 in addition to higher costs of operating vehicles, such as higher fuel and spare parts prices. In a rising interest rate environment, we do also expect slightly lower demand for car loans.
According to the National Association of Automobile Manufacturers South Africa (NAAMSA), a total of 1,054 new vehicles were sold during March 2022, compared to 883 in the previous month, a 19.4% increase month on month and 14.7% increase year on year.
