Motoring 2014: How the wheels will turn this year
- Deon Schoeman
- Life, etc
- 23 Jan 2014 (South Africa)
For South Africans, 2014 is set to be an interesting and challenging year – and for many reasons. But while the elections and the economy will be major talking points, they will also have a real impact on our motoring lives. DEON SCHOEMAN takes a look at the trends that are likely to shape our motoring year.
Prepare yourself for a rough and challenging ride in 2014. After extended growth and positive trends, the South African motor industry will be facing tougher times this year – and that goes for us motorists, too.
Factors such as the local elections, the weakening of the rand, the softening economy, rising fuel prices and poor service delivery will all have an impact, as will the continuing stand-off between SANRAL and Gauteng’s motorists on the e-toll issue.
South Africans are particularly passionate about motoring. A general lack of reliable and safe public transport, and the long distances we travel as a matter of course, mean that cars mean more to us than being mere appliances.
The long-established local trend of including car allowances in remuneration packages also means that a car remains a highly visible status symbol – and that we’re prepared to spend an inordinate percentage of our income on acquiring, operating and maintaining the shiny cars we drive.
So, what does 2014 hold in store for the South African motoring public? What trends will shape our motoring lives this year?
The demand for used cars will increase sharply
With new car prices expected to increase significantly in 2014, those fancy wheels will move out of the reach of more and more mainstream, middle class buyers.
Those buyers will start looking at pre-owned market, where relatively recent models, some still covered by the balance of a maintenance or service plan, can be purchased at significantly lower prices than the brand new version.
That’s especially true of so-called premium brands, which are appealing not only because of the maintenance plan and the comprehensive service history that comes with it, but also because of the aspirational status these brands enjoy.
There is no doubt that a good, recent-model pre-owned car with two to three years of full maintenance remaining, represents better value than the new car. And remember, it has already absorbed the initial depreciation that all new cars suffer from when first registered.
But there are some negatives: once the maintenance or service plan expires, running costs will increase sharply – so seeking an extension of the maintenance plan becomes vital for anyone considering longer-term ownership. And as with all used cars, the danger of latent defects as a result of misuse or an undeclared accident remains a real concern.
Electric and hybrid cars will become more prevalent
This could be the year that electric and hybrid cars finally become accepted into the motoring mainstream. The momentum around these cars has been building for some time now, and several factors will favour their increased prevalence.
For starters, the promise of reduced fuel consumption will be tempting, given that fuel prices are expected to rise substantially. It’s a fact that hybrid cars driven sensibly will achieve low fuel consumption figures, and the potential cost saving will increase as petrol and diesel become dearer.
Photo: BMW i3
Also contributing should be the improved accessibility of hybrid technology as it becomes more widely applied – although in our market, that will be counteracted by the price increases dictated by a weaker rand.
Perhaps more important is the arrival of our first true electric cars – the Nissan Leaf is already on sale, while BMW’s i3 is due for release by mid-year. Both have limitations in range, but will prove just how feasible all-electric motoring can be. As the tech matures and becomes cheaper, expect more electric and hybrid cars to reach our shores.
Photo: Nissan Leaf
Finally, let’s not discount the growing awareness of the need for environmental responsibility. There is a perception that hybrid and electric cars are more eco friendly – although, given that our electricity is generated from coal-fired sources, that my not necessarily be the case.
However, don’t expect our vehicle park to change overnight: prices of electric cars will remain relatively high in the immediate future, while the cost and availability of electricity make a high take-up of electric cars unlikely.
Expect more Chinese and Indian-made cars
One of the big trends shaping motoring in SA this year will be affordability – and right now, Chinese cars are priced well below their more established rivals, making them increasingly appealing to cash-strapped motorists.
Photo: GWM M4
That also goes for cars manufactured in India, where economies of scale and lower manufacturing costs allow lower retail prices. Already, major brands like Honda and Ford are sourcing some of their entry-level models from India.
Chinese brands like GWM, Chery, Geely and FAW are all poised to make significant inroads into the local vehicle market this year, and while sales have been hampered by older technology and inferior quality, that is rapidly changing as the Chinese auto industry catches up with first-world brands.
Photo: GEELY GX7
Right now, many Chinese cars still lag behind their mainstream rivals in tactile quality and performance terms, while smaller dealer networks also suggests less access to after-sales service and back-up. But there’s no doubt that Chinese marques will see a groundswell of support from SA consumers this year.
Fuel economy will become an important statistic
Because SA motorists are passionate about their cars, power and performance statistics have been traditional yardsticks for decades. But in 2014, fuel consumption will become a key figure to consider.
Fuel prices are set to increase this year as a result of a weakening rand a likely, demand-driven increase in the crude oil price. For commuters, dearer fuel immediately ups running costs, and places further pressure on an ever eroding disposable income.
Those with older-technology cars, or high-mileage models, will feel the impact more acutely, as their cars won’t be frugal enough to begin with. Buyers will also start focusing on smaller, more efficient cars, while dumping larger, older cars in the process.
Photo: DATSUN GO
Even premium brands are likely to see a shift from their larger models to smaller, more frugal cars that still offer the comfort, technology and aspirational appeal of the brand, but in more efficient, and more affordable package.
Of course, rising fuel prices will have a far more wide-ranging impact than dictating car buying trends. Much of SA’s transport network is road-based, meaning that fuel price increases lead to higher prices across the board. With disposable income under increasing pressure, the demand for higher wages will not abate, so labour unrest is likely to continue, too.
Compact crossover vehicles will become more popular
While small cars will become more popular, we can also expect a growing number of compact crossovers to reach our shores – cars that have the footprint of a small city car, but employ clever packaging to boost interior space and versatility.
The Nissan Juke is a good example, linking Micra-sized dimensions to a taller stance and efficient packaging to create a roomy, versatile and appealing interior, while its tall stance adds presence and boosts all-round visibility.