Aug 22, 2018 Wesbank, Car Sales, Naamsa, economy, automotive, aftermarket, cost of motoring
According to the latest results from Wesbank, South Africa's average costs of motoring has increased by approximately R940, or 14% in the last year. The cost is up 31% since 2013 and is despite prevailing interest rates remaining at low levels and favourable vehicle price inflation. Wesbank highlights the rising cost of petrol and an increase in VAT from 14% to 15% as causing the higher overall costs, looking at the total monthly cost of motoring. Vehicle instalments and fuel spend remain the biggest components, accounting for 80% of monthly mobility spend.
These costs are reflected by the WesBank Mobility Calculator, a tool the bank uses to track and calculate historic motoring costs. The total mobility basket comprises all fees that are involved with vehicle ownership: a monthly instalment, the insurance premium, fuel and maintenance. Over time, these costs are updated to reflect prevalent inflation rates and fuel prices, with the sample vehicle price based on an average entry-level car that travels approximately 2500km per month.
Ghana Msibi, Executive Head of Sales and Marketing, WesBank comments: “The past year has been a rollercoaster ride with drastic fuel price fluctuations making it difficult for consumers to keep track of monthly budgets. As a rule, we generally advise motorists to allow some breathing room in their budgets to help absorb these changing costs.”
The bank also highlights that according to its data, the change in vehicle price inflation for new vehicles has had a favourable effect on purchase prices. In July this year, WesBank’s average new vehicle financed deal was only 1.43% higher than the same time last year at R307 445, while the average used vehicle finance deal is 6.9% higher than that of last year at R216 309.
“International oil prices and local exchange rates continue to play a direct role in the monthly budgets for motorists, in both fuel and vehicle prices,” said Msibi. “Although manufacturers are offering attractive marketing incentives to lure customers into dealerships, consumers still have to spend more on vehicles, fuel, insurance and maintenance than ever before.”
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