new car market stabilises
The new vehicle car market is showing the first signs of stability and dealers are looking ahead to better times with cheaper petrol prices and unchanged interest rates outweighing the possible effect of global financial uncertainty.
The WesBank Vehicle Sales Confidence Index for the third quarter puts the index at 4,7 out of 10 the same as in the previous three months, although down from the 5,4 score in the December 2007 quarter.
The 4,7 rating, however, puts the index in an "inactive" category at between 4 and 6 points.
Ever optimistic motor dealers are nevertheless confident that the index could rise to 6,2 in the next six months and 7,1 in the next 12 months, which would put it back in an "active" category.
Dealers also noted that July had probably represented a peak in the interest rate cycle and that further reductions were expected in 2009, according to WesBank's sales and marketing director Chris de Kock.
WesBank monitors its present and future assessments from its own finance book and other sources and claims it gives an accurate insight into confidence in the market.
Major factors affecting the market have been interest rates - it scored almost 30 percent - in assessing the future performance of the industry, followed by the fuel price, economic factors, the National Credit Act and surprisingly, the cost of living, which rated only 4,8 percent in terms of influencing factors.
De Kock said that households should start paying off short-term debt in order to service other fixed debt.