South Africa’s new vehicle market closed the third quarter on a strong note, with September sales rising 12.7% year-on-year to 61,645 units, despite affordability pressures and the recent 25 basis point increase in the repo rate to 7.25%. The result compares with 54,706 units sold in September 2025, according to naamsa.
Passenger vehicle sales increased 14.7% to 44,291 units, while light commercial vehicles, bakkies and minibuses grew 9.6% to 14,361 units. Dealer sales accounted for 81.4% of the market, with the rental industry contributing 13.8% of total industry sales. “September’s performance shows that demand for vehicles remains resilient, even as consumers face higher borrowing costs and renewed pressure from fuel and other living expenses,” says Thanda Sithole, Senior Economist: FNB and WesBank. “What is particularly encouraging from a financing perspective is that WesBank’s application data also indicates continued demand, with new vehicle finance applications growing year-on-year and at a faster rate than total vehicle applications.”
WesBank’s application data also points to a more deliberate approach to vehicle financing. New vehicle applications accounted for a larger share of total applications than a year ago, while used vehicle applications also increased. At the same time, the average new vehicle finance deal was smaller than a year ago, while the average used vehicle deal was larger. Contract terms have also lengthened, particularly for new vehicles, while a greater proportion of customers opted for fixed-rate finance, providing greater certainty around monthly repayments as interest rates change. Balloon payments featured in fewer deals.
“The application trends suggest that customers are not simply stepping away from the market in response to affordability pressures; they are adjusting how they structure their vehicle purchases,” says Sithole. “For consumers, the focus is increasingly on managing the total cost of ownership and finding a finance structure that provides greater certainty over the life of the agreement.”
The cost of running a vehicle remains an important consideration. Headline inflation increased to 4.4% in August from 4.3% in July, with fuel among the contributors to the increase, while higher fuel prices are expected to place further pressure on household budgets in October.
At the same time, the shift towards electrified vehicles continues to gather pace. naamsa reports that 18,945 new energy vehicles were sold in the first eight months of 2026 – already 13.4% above the 16,703 units sold during the whole of 2025. Approximately one in every 20 new vehicles sold this year is now electrified, with plug-in hybrids and battery electric vehicles accounting for more than half of NEV sales.
“As fuel and running costs become an increasingly important part of the vehicle-buying decision, consumers are looking beyond the monthly instalment to understand the broader cost of ownership,” says Sithole. “The instalment, insurance, maintenance and fuel costs all need to be considered when determining what is genuinely affordable. With the latest repo rate increase still to feed through to repayments, the next few months will provide an important indication of how consumers continue to adapt.”
With the final quarter now underway, vehicle demand will provide an important indicator of how South African consumers respond to the combination of higher financing costs, fuel-price pressures and evolving vehicle choices. Customers considering a vehicle purchase can compare finance terms, instalments and fixed- and linked-rate options using WesBank’s online finance calculators before applying.
