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Sunday / 26 June 2022
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Most popular price ranges for cars in South Africa

The R100,000-R200,000 price range is where most South African car buyers applied for used vehicle finance in 2022, whereas the R200,000-R300,000 range is where most consumers applied for new vehicle finance.

These findings were revealed in Absa’s recent consumer insights study, which tracked trends in car finance applications submitted to the financial institution during the first quarter of 2022.

Popular finance bands

According to Absa, the R100,000-R200,000 price bracket was the most popular among consumers applying for used vehicle finance with 38% of applications falling in this range, although this reflects a substantial decrease of 15pp (percentage points) over the same period in 2019.

Similarly, 13% of new car finance applications fell into this band, also a decrease of 15pp over 2019.

However, the range between R500,000-R600,000 experienced considerable growth of 7pp in applications since 2019, which helped offset the decrease in new vehicle purchases in the lower finance bands, said Absa.

This is echoed in the used market, with the price range that saw the most growth over past two years being the one between R200,000-R300,000.

In the first quarter of 2022, this bracket was home to 32% of all used car finance applications, a 7pp jump.

Additionally, the R300,000-R600,000 range in the used market experienced noticeable growth of 11pp since 2019.

Buyer preferences

Absa said roughly 74% of used vehicle finance applications of between R100,000-R300,000 in 2022 were for vehicles built in Europe or USA, a decrease of 7pp over 2019.

In the higher finance bands, such as used vehicles priced above R500,000, cars from Japan and South Korea now also account for 6% of finance applications, compared to 0.5% two years ago.

Furthermore, new vehicles from China, India, Japan, and South Korea also benefited from this change in buyer preferences.

“Japan/South Korea new vehicles moved up by 13pp from 2019 for vehicles valued between R500,000 to R600,000,” said Absa.

“In 2019 Q1, vehicles over R500,000 from China/India OEMs accounted for less than 1%; however, in 2022, they make up 13% of the entire financed vehicles base in Q1.”

The financial institution also said that, out of all the used vehicle finance applications it received in the first three months of 2022, 67% of the applications were submitted by males and 33% by females.

However, when it came to new vehicle purchases, a significantly lower 54% of finance applications were from males and a higher 46% from females.

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