Ricochet News

Auto industry reactions: GMSA

By Ian Nicholls - Feb 23, 2016
Auto industry reactions: GMSA

A major development for GM South Africa happened earlier in 2015 when we signed a framework agreement with Isuzu Motors Limited to build light commercial vehicles at high volume for both domestic and export markets in the future. During the course of 2016, we will be announcing more definitive details around this agreement.

The new car sales environment remained very competitive with over 70 new or upgraded vehicles launched in 2015.  GM South Africa alone launched six new vehicles which included the new Opel Corsa, Opel Mokka, Opel Adam Rocks, upgraded Chevrolet Cruze and enhancements to our Isuzu range of bakkies. Additionally, we were very excited that two of our newly launched vehicles- Corsa and Adam - were named among the twelve 2016 Car of the Year finalists.

Looking into 2016 there is no doubt that the market will remain under pressure and is unlikely to grow as result of contributing factors such as higher interest rates, the weakening of the Rand, historically low business and consumer confidence and finally also slow GDP growth. 

The already very competitive automotive industry, which combined represent over 60 different brand offerings to consumers, will continue to offer customers aggressive incentives on particular carlines and will probably also consider further enhancing aftermarket support options to customers.

In terms of vehicle purchasing trends, the small/mini passenger car and the compact SUV markets will further grow while mid-size cars will be in less demand. 

Turning to light commercial vehicles, this segment will remain highly competitive as customers have much more choice than ever before and as they exercise their options to buy down across the entire model range. Medium and heavy commercial vehicles sales are expected to remain stable.

My expectation when considering vehicle purchasing patterns is that following on European trends, smaller displacement engines will grow in popularity while diesel engines will remain as a small segment in the passenger car market. 

When one looks at how fast technology has moved, particularly in the telecommunications space, it is no surprise that customers are expecting their vehicles to be an extension of their mobile devices and offices.

This means that in the future infotainment will become the norm, rather than the exception. And at GM South Africa we are embracing this – in fact all the new vehicles which we will be launching this year will incorporate state of the art infotainment systems. In total we will be launching six new vehicles this year.