The National Automobile Dealers’ Association (NADA) claims extensive administrative delays in document turnaround times and vital operational systems are drastically impacting motor vehicle sales in South Africa.
What many don’t realise, as the NADA points out, this has a dire knock-on effect on the automotive industry and the vast number of associated businesses therein. Explaining the severity of the situation, Transport Minister Fikile Mbalula recently said, South Africa has a backlog of 320 000 drivers’ licences, with this demand growing by 90 000 each month. He acknowledged this issue was a direct result of corruption at Drivers Licence Testing Centres.
In an attempt to resolve the issues, the Department of Transport will now be embarking on a series of interventions, which includes looking at problematic Drivers Licence Testing Stations and extending operational hours. While the NADA welcomes the increase in capacity across the country to address the issue, it appears the difficulties do not end there.
“This is just one administration in a chain that supports the trading of new and used vehicles in the country. Yet, while we realise the enormous pressures and other priorities impacting South African mobility at this difficult time, our requests to assist the Department of Transport to address these issues have gone unanswered since 24 August. Meanwhile, direct value continues to be lost across the motor industry value chain, courtesy of lost deals from the simple inability of licensing departments to make transactions possible. This is severely hurting the economy that could be forging a better path were it administratively possible.”
Moreover, NADA explains several small business entrepreneurs should be focusing on building their businesses, instead of having employees queuing for driver’s licence renewals and chasing new vehicle registrations.
The association adds, “The automotive industry is highly dependent on municipal licensing departments to license, register, roadworthy and dealer stock vehicles as these are key legislative requirements in the purchase and sales process of motor vehicles. The backlogs at these departments have resulted in a material slowdown in vehicle sales that could have been mitigated. There are extensive delays at licensing departments nationally.”
As you would imagine, the consequence of the significant delays in drivers’ license renewals, results in a growing number of declined finance applications due to missing documentation and an inability for new owners to insure their vehicles. This is exceptionally worrying, as it has a significant effect on the economy, an economy which is already beaten to a pulp.
The Newcastillian – Online News discusses the issue with Nicolas Lizen of NL Cars. With years of experience in the automotive sales industry, Nicolas is no stranger to the ins and outs of the sector.
Looking at declining car sales, due to the problem with licence renewals, Lizen points out this is not as big of an issue in Newcastle as some might think. In fact, he claims he has not heard of any issues pertaining to deals falling flat due to new owners not having their driver’s licences.
Furthermore, in his experience, Lizen states recent months have proven to be fruitful—”I closed for two months, April and May, re-opening again in June. Since then, we have done very well. It has been unbelievable.”
Stucky Motors added that they too were not affected by the backlog of drivers’ licences, and in reality, their sales process has been business as usual. In conclusion, living in smaller communities most certainly has its benefits, and this problem which many South Africans are dealing with, yet we are not, can most certainly be added to that list.
The Newcastle, Dundee and Vryheid Road Traffic Inspectorate were contacted for a statement on the matter. Unfortunately, no comment was available at the time of publication, which is sad, as this is a feather in their cap.
Never the less, with the automotive industry facing its fair share of challenges after the year we have all endured, what are your thoughts on the current situation?
Share your views with us in the comment section below
Author: Quinton Boucher
Edited: Calvin Swemmer