JOHANNESBURG (Reuters) -- South African new car sales soared to their highest level for 6-1/2 years in July, and total vehicle sales jumped 7.6 percent from their levels a year ago, data from manufacturers showed on Monday.
The National Association of Automobile Manufacturers of South Africa (Naamsa) also said second-half sales should gain support from expected cuts in interest rates and improvement of the economy, price restraint and attractive sales packages.
Naamsa said in a statement 22,988 new cars were bought in July, up 8.6 percent over the same month a year ago and a rise of 15.7 percent from June's 19,865 units.
Total new vehicle sales rose to 34,077 units from 31,659 in July a year ago and 29,995 in June.
"With July reflecting the best sales month we have had since March 2001, business and consumer confidence appears to have improved," said Nigel Harris, Ford Motor Co. of South Africa marketing and sales director.
"We are certainly hoping that we have turned the corner with stronger growth months expected through to the end of the year," he added in a statement.
Prime lending rates set by commercial banks stand at 15.5 percent, and the Reserve Bank is widely expected to slash 300 or more basis points off rates by the end of 2003 as inflation subsides rapidly.
The bank is widely expected to cut its key repo rate by at least 100 basis points at its policy meeting on August 13-14, after slashing it by a wider-than-expected margin of 150 basis points to 12 percent in June.
Economic growth is also expected to accelerate after a sharp slowdown in the first few months of the year, blamed mainly on the impact of last year's interest rate hikes, a strong rand and a global slowdown.
Naamsa cited lower interest rates along with renewed demand from the rental sector and more attractive prices as factors behind the recent buoyant figures.
Sales for the January-July period were up 0.3 percent on the same period a year ago at 206,296 units, after languishing one percent below the year-earlier period from January to June.
In July, the only segment to record lower sales than in June was medium commercial vehicles, with only 408 units sold against 518 a month earlier. All other segments -- passenger, light commercial and heavy commercial -- showed gains.
Toyota took the lead in total vehicle market share with 8,707 units sold.
Vehicle exports were marginally up in June, the latest month for which figures are available, over May. A total of 10,480 vehicles were exported during June, up from 10,359 in May.