Used car inflation is slowing down
Industry news / 24 Jan '13, 12:49am
Good news for used-car buyers is that price tags, especially on one- to three-year-old cars, are getting more affordable in South Africa.
Prices haven’t reduced, but inflation of pre-owned vehicles in 2012 was nipped in the bud at just 2.2 percent, 1 percent lower than the previous year and way under the general inflation rate.
This is according to the Trans-Union Vehicle Pricing Index (VPI), which attributed the continued pressure on the used market to ongoing new-vehicle discounts and assistance programmes. This was particularly evident in the one- to three-year-old segments, as these models compete more directly with new and demo models.
“This trend is expected to continue for the foreseeable future as dealers and manufacturers compete to ensure that the new products are attractive to consumers,” added a TransUnion spokesman.
New-vehicle inflation was also marginally down last year from 2.7 percent to 2.2 percent. However, TransUnion says several motor companies had already introduced, or would be introducing, annual price increases on new vehicles this month.
“Should the rand remain weak, there could be further inflationary pressure on new vehicle prices as the year progresses,” he said.
Used cars still outsell new cars in SA, at a ratio of 1.75 used cars for every new car. -Star Motoring