Fewer, but larger multi-brand franchises are set to become the norm in South Africa, says Gert Debeer, a director of Canada-based automotive business Autofacts. If vehicle affordability was addressed, “the country could retail one million units a year”.

Fewer, but larger multi-brand franchises are set to become the norm in South Africa, says Gert Debeer, a director of Canada-based automotive business Autofacts. If vehicle affordability was addressed, “the country could retail one million units a year”.


Speaking at an automotive retailing briefing on Tuesday, Debeer said Canada had a population of 30 million and sold 1,6 million vehicles a year, and South Africa should therefore be selling one million units a year.


“Strategies needed to be developed in South Africa to make vehicles more affordable,” he said. "We need to build a much stronger middle-income group. I think private leasing will also become an option as the country goes forward."


Debeer said the pressure on motor dealerships in South Africa was "profound" and the current model of dealers selling an average of 30 vehicles a month would be unsustainable in the future.


"There will be a major transformation in SA," said Debeer, who added there could be a downward spiral in prices of second-hand cars, making it difficult for small dealers to run used-vehicle businesses profitably.


Because dealers were facing pressure from manufacturers to invest in new technology and found it difficult to recoup the costs of such capital expenditure, “larger dealers were more likely to survive and many smaller dealers would go under”.

Original article from Car