Rental companies are a major customer for South Africa's car manufacturers
South Africa's car rental companies bought thousands of new vehicles in October, accounting for more than a fifth of all passenger cars sold during the month.
Rental Companies
South Africa's car rental companies bought thousands of new vehicles in October, accounting for more than a fifth of all passenger cars sold during the month. The figures are worth looking at because new car sales are often discussed in terms of private buyers.
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South Africa's car rental companies bought thousands of new vehicles in October, accounting for more than a fifth of all passenger cars sold during the month. The figures are worth looking at because new car sales are often discussed in terms of private buyers. But rental businesses are also placing large orders, and those purchases make up a meaningful part of the market. According to naamsa, rental companies accounted for 21.4% of passenger-car sales in October. Their share of the entire new-vehicle market was 16.5%, up from 13.8% in September. South Africa sold 61,890 new vehicles during October, 10.4% more than a year earlier. Passenger car sales reached 45,084, an increase of 13.6%.
Suzuki, Volkswagen and Kia record rental sales
Suzuki had a particularly strong month. It sold 7,292 vehicles, including 2,232 to rental companies. Volkswagen Group Africa, including Audi, recorded 6,515 sales, with 1,624 going to the rental sector. Kia sold 2,233 vehicles, of which 733 were rental sales. For these manufacturers, rental companies are not occasional customers. They are an important part of the sales business.
“Rental companies are buying enough vehicles to influence South Africa's monthly new-car sales figures.”
What rental companies look for when buying vehicles
Rental operators need vehicles that can handle daily use without becoming too expensive to maintain. They also have to consider how much they will get when those vehicles are eventually sold. Fuel consumption, servicing costs, parts availability and resale value all matter when deciding which models to buy. That can influence which brands get fleet orders and how many vehicles dealerships need to keep available.
Rental fleets create work for other automotive businesses
There is also a local business angle that receives less attention. Every rental vehicle on the road needs maintenance. Tyres wear out, windscreens get damaged, batteries need replacing and vehicles have to go in for servicing. Some will also need accident repairs. That work keeps workshops, tyre suppliers, parts distributors and panel beaters busy. Rental companies can be attractive customers because they operate large fleets and need regular maintenance. However, suppliers must be able to offer competitive rates and get vehicles back on the road quickly.
How much do rental companies contribute to new-car sales?
The figures also put October's sales growth into perspective. Dealerships accounted for 78% of total new-vehicle sales, followed by rental companies at 16.5%, government at 3.3% and corporate fleets at 2.2%. So while private motorists remain central to the market, rental companies are buying enough vehicles to influence the monthly numbers. Whether their contribution stays at this level will depend partly on fleet replacement plans and demand for rental vehicles over the coming months. October's figures show that manufacturers and dealerships have another substantial customer group to serve beyond the person walking into a showroom to buy a car.
