Categories: NewsVehicle News
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2023-12-06 12:38 PM

Surging SUV Prices in South Africa

  • Rising SUV Prices in South Africa: The article highlights the significant increase in Sport Utility Vehicle (SUV) prices, exceeding inflation rates and impacting consumers' purchasing power.
  • Limited Affordable Options: With only 16 SUV models priced under R650,000 in South Africa, buyers face a reduced selection within a reasonable price range, necessitating careful financial considerations before purchase.
  • Impact on Consumers: The escalating costs of SUVs pose challenges for prospective buyers, emphasizing the need to analyze affordability and explore available options amidst the changing dynamics of the automotive market.
By Miriam Matoma

In recent times, the automotive market in South Africa has witnessed a surge in the popularity of Sport Utility Vehicles (SUVs). Renowned for their adaptability and functionality on the nation’s diverse roads, SUVs have become an increasingly common choice among South African drivers. However, the soaring prices of these vehicles have created a landscape where only a limited selection of SUVs falls within the affordable bracket for many consumers, with just 16 models presently priced under R650,000 in the country.

South Africa’s penchant for outdoor activities, diverse terrains, and challenging road conditions has contributed significantly to the rise in SUV popularity. These vehicles, equipped with higher ground clearance and robust build, instill a sense of confidence and safety, making them an ideal choice for traversing both rough off-road trails and pothole-ridden city streets.

The allure of SUVs extends beyond their on-road capabilities. Their ample cargo space and towing capacity cater perfectly to the needs of families and outdoor enthusiasts, facilitating the transportation of equipment and gear required for various adventures across the country’s landscapes – from national parks to camping destinations.

However, the surging prices of new vehicles, particularly SUVs, have become a cause for concern among consumers. The escalating costs are attributed to factors such as the vehicle size, fuel consumption, and inflationary pressures impacting manufacturing expenses in South Africa.

TransUnion’s latest Vehicle Pricing Index (VPI) underscores this issue, revealing a substantial 6.7% average increase in the price of new vehicles throughout 2023. This hike surpasses the inflation rate (CPI), and experts forecast a further upsurge in the coming months, affecting all vehicle segments.

Breaking down the numbers, medium SUVs and hatchbacks saw the steepest increases at 7.4% in the second quarter of 2023. Other year-over-year price increments included small SUVs (6.8%), premium and hybrids (6.6%), crossovers (6.4%), and electric vehicles (3.1%).

Consequently, the dwindling number of SUVs priced below R650,000 presents a challenging scenario for budget-conscious buyers. Among the few options available, the Mahindra Scorpio-N, Mahindra XUV700, and the Haval H6 stand as the only SUVs retailing for under R500,000. Conversely, the upper echelon of this category showcases the Kia Sportage as the most expensive SUV under R650,000, retailing at R637,995.

To grasp the affordability of these vehicles, one needs to consider the income required to afford them. Assuming a 60-month term at an interest rate of 11.75% with no balloon payment, affording the cheapest SUV, the Mahindra Scorpio-N, would demand an income slightly over R42,000.

Below is a comprehensive list of the 16 SUVs currently available in South Africa priced under R650,000, along with their respective starting prices:

Mahindra Scorpio-N – R473,999

Mahindra XUV700 – R479,999

Haval H6 – R484,750

Mazda CX-5 – R524,600

Proton X70 – R529,900

Proton X90 – R559,900

BAIC B40 – R574,500

Opel Grandland – R599,900

Hyundai Tucson – R584,500

Peugeot 3008 – R599,900

Chery Tiggo 8 Pro – R609,900

Honda CR-V – R609,900

Volkswagen Tiguan – R614,600

Renault Koleos – R620,999

Citroen C5 Aircross – R633,900

Kia Sportage – R637,995

In conclusion, the escalating prices of SUVs in South Africa have rendered affordability a pressing issue for potential buyers. As the market dynamics continue to evolve, consumers face limited options within a reasonable price range, prompting them to carefully assess their financial capacities while exploring the available selections in the SUV segment.

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Miriam Matoma

Miriam is a freelance writer, she covers economics and government news for Rateweb. You can contact her on: Email: miriam@rateweb.co.za Twitter: @MatomaMiriam

Tags: SUV Prices