South Africa’s GDP contracted 0,1% in the first quarter of 2024, according to Stats SA. Manufacturing was the largest negative contributor on the production side of the economy during this period, declining by 1,4% and pulling GDP growth down by 0,2 of a percentage point.
Of the 10 manufacturing divisions in the country, five performed poorly and the automotive sector was the largest negative contributor.
Stats SA attributed the poor performance in the automotive sector to weaker demand for new vehicles and transport parts and accessories.
This is reflected in the broader decline in household consumption expenditure during the first quarter, where consumers cut back on transport-related spending among other categories.The automotive sector’s struggles were worsened by a 2.3% decrease in exports, which pulled down overall expenditure on GDP growth by 0.7 percentage points. Weaker exports of vehicles and transport equipment (excluding aircraft) were a major factor in this decline.
According to Naamsa, for the first quarter of 2024, domestic vehicle production reflected a decline of 2,2% compared to the corresponding quarter of 2023, which is linked to a constrained domestic new vehicle market along with lower vehicle exports.
Vehicle exports lost momentum and declined by 3,7% from the first quarter of 2023 to the first quarter of 2024, following the record export performance of 399,594 vehicles exported in 2023.
