The Motor Industry Staff Association (Misa) has lamented the negative impact of South Africa’s dire economy, citing retrenchment, the ever-increasing fuel price, and dwindling sales resulting in restructuring by the industry.
Martlé Keyter, chief executive officer (CEO) of operations at Misa, said the ailing economy has seen the retrenchment of 53 members in Gauteng during October, after three dealerships closed – with more to follow given the proposed closure of 11 retail stores of an international tyre producer.
“The producer believes it is no longer viable to keep its doors open in South Africa due to the cost of doing business, and the shrinking economy taking a toll on the tyre industry,” she said.
Keyter said another large dealership group also gave notice of restructuring at 11 dealerships nationwide.
“This could lead to retrenchments.”
Keyter said the industry was struggling to continue business, worsened by the daily load shedding, skyrocketing fuel prices, and an interest rate at 8,25% – at its highest in 14 years.
Keyter said new vehicle sales slumped in September, with 46 021 vehicles sold – a 4,1% drop compared to the 47 984 of September 2022.
A recent survey indicated that 30% of middle-class consumers have bought a car in the past year. Of these, 82% of consumers indicated that fuel consumption was the most important feature when buying a car.
On 4 October motorists had to adjust to a higher than expected fuel price increase. Petrol increased by between R1,08 (93 Unleaded) and R1,14 (95 Unleaded), while diesel prices increased with between R1,93 (low-sulphur 50 ppm) and R1,96 (500 ppm).
“The high cost of living and the declining take-home pay has a severe negative impact on mental health, especially in an industry that is performance driven,” said Keyter.
