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An Impact Assessment of Covid-19 on the South African Automotive Industry

Author

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  • Ephrem Habtemichael Redda

    (North-West University, South Africa)

  • Jhalukpreya Surujlal

    (North-West University, South Africa)

Abstract

The purpose of this article is to provide an impact assessment of Covid-19 on the South African automotive industry. The study is exploratory in nature and employs descriptive quantitative analyses. Monthly time series data (01/2000-01/2021) available from Statistics South Africa (StatsSA) were used for analysis and to achieve the objectives of the study. The results indicate that since the beginning of March 2020, all categories started to show significant contraction, and the worst negative growth was observed in April at the height of the Covid-19 pandemic regulations imposed by the government. Measured in nominal values at current prices and compared on a year-on-year (YOY) basis, the largest negative annual growth rate (contraction) was in used vehicle sales, followed by new vehicle sales, income from sales of accessories, workshop income, fuel sales, and convenient store sales. The overall YOY actual motor trade sales contracted by a massive 84%, and when seasonally adjusted, by 81%. Led by used vehicle sales, the automotive industry was able to recover rather quickly as the restrictions imposed by the government were eased from May 2020 onwards. However, the overall performance of the industry is still in a worse state when compared to the preceding year, 2019. Looking forward, the gradual increase in overall motor trade sales suggests a positive trend of growth.

Suggested Citation

  • Ephrem Habtemichael Redda & Jhalukpreya Surujlal, 2021. "An Impact Assessment of Covid-19 on the South African Automotive Industry," Eurasian Journal of Business and Management, Eurasian Publications, vol. 9(3), pages 208-216.
    • Handle: RePEc:ejn:ejbmjr:v:9:y:2021:i:3:p:208-216
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    References listed on IDEAS

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    1. Margaret Chitiga‐Mabugu & Martin Henseler & Ramos Mabugu & Hélène Maisonnave, 2021. "Economic and Distributional Impact of COVID‐19: Evidence from Macro‐Micro Modelling of the South African Economy," South African Journal of Economics, Economic Society of South Africa, vol. 89(1), pages 82-94, March.
    2. World Bank, 2020. "Global Economic Prospects, June 2020," World Bank Publications - Books, The World Bank Group, number 33748, December.
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