WeeklySA_AdminInterest rate hikes: With an increasing number of vehicle owners defaulting on their payments perhaps its time to downgrade
By Ali Mphaki
Save from losing a parent, a partner, or your lovely pet, there is no pain to beat like having your vehicle repossessed for defaulting on payments. It’s like the whole world has come to a standstill, literally.
Fact is South Africans are struggling to keep up with their monthly expenses, in the wake of a string of interest rate hikes that have seen steady and steep increases in loan instalments, leading to more people defaulting on debt repayment, especially with regard to home and vehicle financing.
This is evident in the number of vehicle owners defaulting on their car payments in the first Quarter of 2023, which is up by 4% Year-on-Year, according to the Experian Consumer Default Index (CDI) – amounting to an astronomical figure of R 4 billion.
The Experian CDI is designed to measure the rolling default behaviour of South African consumers with Home Loan, Vehicle Loan, Personal Loan, Credit Card, and Retail Loan accounts over three-month periods. Credit Bureau Transunion reports a 650 basis points increase in first-month defaults compared to the first quarter of 2022, in its Quarterly Overview of Consumer Credits Trends for Q1 2023. Owning a car is a significant investment for many South Africans, providing mobility and convenience. However, life circumstances can change unexpectedly, making it difficult to keep up with car payments.
“If you find yourself in a situation where you are unable to meet your financial obligations, it is crucial to understand your rights as a consumer and take the necessary steps to protect yourself from vehicle repossession,” says Neil Roets, CEO of Debt Rescue.
He advises cash-strapped vehicle owners to react promptly and be wise in weighing up the various options available to them, if they are in default of their vehicle payments.
Downgradding would be another option and here below is a list of the most affordable cars in South Africa:
* Tata Bolt/Zest 1.2 Turbo, a sedan and hatchback duo, is the cheapest car in South Africa marketed by Accordian Investments (Pty) Ltd. The base model price starts at R132,995. Also, both models, sharing the same platform, are equipped with a Revotron 1.2-litre, turbocharged MPFi petrol engine. This engine provides a maximum power of 66kW at 5000 RPM and a peak torque of 140Nm between 1500-4000 RPM, combined with multi-drive technology
* Baic D20 – R149,990 The Baic D20 was launched in April 2017 and comes in sedan and hatchback versions. China’s sixth largest car manufacturer, BAIC (Beijing Automotive Group Co), has sold vehicles in South Africa since 2017. T
* Suzuki S-Presso – R169,900 Maruti Suzuki S-Presso in 1.0GL trim is among the cheapest mini-SUV in South Africa in 2023. It is good for first-time car buyers and is among the cheapest passenger cars, with low fuel consumption of 4.6 L/100km. Recently upgraded, this car model introduced in 2020 now boasts a stylish appearance.
* Volkswagen Up – R169,900 Volkswagen Golf R Tsi introduced at the 2011 International Motor Show in Germany has quickly gained popularity as an affordable option in South Africa. The latest model offers 44kW of power and 95Nm of torque, with prices starting at R169,900.
*Mahindra KUV 100NXT – A budget crossover from R172,999 it offers impressive fuel efficiency, driving comfort, and a striking design. Originally introduced by the Indian manufacturer as the Mahindra KUV 100 in 2016.The KUV100NXT is available in petrol and diesel variants, with three trim levels: K2+, K6+, and K8
MOTORING:
Briefs
AIN’T NO STOPPING TOYOTA
With 10,812 units retailed in July, Toyota was once again South Africa’s best-selling brand powered by a strong demand across its line-up. As the only manufacturer to breach 10,000 units per month (and accomplish this six months out of seven for 2023), Toyota’s market share for July was a commanding 24,9%. Hilux realised 2,982 sales in July, contributing to its dominance in the LCV space – YTD racking up cumulative sales numbers close to 22,000 units for a 25,2% segment market share.
An improved inventory flow for this model also helped Toyota’s exports for the month, with Hilux accounting for 7,273 of the 7,437 units shipped out in July. Other LCV highlights include the Hiace which ticked over with sales of 1,347 units and the Land Cruiser 79 pickup, a consistent performer with a solid 312 registrations.
CHINA LEADS GLOBAL EV DRIVE
A total of 53 percent of all fully electric cars and plug-in hybrids globally were running on China’s roads at the end of 2022, according to an analysis published on Wednesday by the German Center for Solar Energy and Hydrogen Research Baden-Wuerttemberg (ZSW).
At the same time, the stock of electric cars in China climbed to 14.6 million vehicles, according to research. The United States and Germany were a distant second and third with 3.4 million and 1.8 million vehicles, respectively.
With a doubling of new registrations to 6.5 million electric vehicles, China also recorded the largest increase of all markets last year, as the country accounted for 60 percent of global registrations, ZSW said in a statement, adding that government’s incentive schemes and “relatively low” prices were the reasons behind the rapid growth. According to the analysis, two Chinese brands were among the top three in the global manufacturer ranking of new electric car registrations in 2022. BYD is in first place with almost 1.8 million vehicles and SAIC is in third place with almost 1.18 million.
VW NEW GTI BADGE ELECTRIC
Volkswagen has filed to trademark a new GTI badge for the electric era, replacing the ‘I’ in the logo with a lightning bolt. The use of the designation had long been in doubt as Volkswagen opted to use ‘GTX’ for the high-performance versions of the ID 4 and ID 5 crossovers, as well as an upcoming variant of the ID 7 saloon.
However, as brand CEO Thomas Schäfer told Autocar in November 2022, “we might not need” GTX as the marque’s mainstream models make the switch to electric power. “GTX as an idea is en route for EVs,” he said, adding it would be “crazy” to let the existing GTI and R designations to “die and slip away” amid the transition. “With a strong brand, you need to spend less getting it out there,” he said.
BMW 6 SERIES GT GROUNDED
BMW has confirmed officially the 6 Series Gran Turismo is now out of production. Liana Drews, a spokesperson for the 5 Series and 6 Series, contacted Motor1.com with the following statement: “As you know, the role of the former BMW 6 Series Coupé, Convertible, and Gran Coupé models is now fulfilled by the corresponding BMW 8 Series. The BMW 6 Series GT (G32) was the last remaining 6 Series model and closely related to the 5 Series (G30/G31).
In the course of the restart of the 5 series in 2023, the BMW 6 Series GT will be discontinued. Its production has now ended. However, some vehicles are still commercially available. So for fans, it’s time to be quick…”
Launched in 2017, the BMW 6 Series Gran Turismo has never been a market success for the Munich company. It hasn’t registered many sales to private customers and has mostly been used as an airport and hotel shuttle in some European countries. It shouldn’t come as a surprise then that BMW has plans to discontinue the model later this year.
