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In A Down Market For New Car Sales, Cape Town Motor Show Appeals To African Aspirations

In A Down Market For New Car Sales, Cape Town Motor Show Appeals To African Aspirations

Location is important when you’re in an ailing economy and trying to pull off an inaugural motor show with the promise that it will rival motor shows in Paris, Tokyo, Dubai and New York.

With new vehicle sales continuing to fall in South Africa, and other African countries stepping up auto manufacturing, South Africa needed a creative idea to invigorate its local auto market and excite domestic motor enthusiasts.

It needed an event that could attract international attention, draw participation across multiple sectors, and promise loads of fun. Mostly, it needed to hold an event in a really, really great place.

The result is the Cape Town Motor Show, a three-day extravaganza planned for Jan. 27-29 at GrandWest Entertainment World.

Cape Town is an event capital in Africa, consistently ranking high or No. 1 as a global business and tourism destination in publications like Condé Nast and BBC Travel.

With a fast-growing supply of hotel rooms to fill, local tourism officials are enthusiastically promoting the Cape Town Motor Show. The event kicked off with an Oct. 19 launch party, attended by local media, celebrities, and a who’s who of South African auto and tourism stakeholders.

South Africa has other motor shows. There’s one held every two years in Johannesburg. This is the first time an international-caliber show will be held in Cape Town.

Both cities have a large enough motor industry to warrant their own motor shows, said Garth Rhoda, who heads up marketing and public relations for the Cape Town Motor Show.

The South African auto industry has had a few difficult years in an economy plagued by a commodities price slump, political turmoil, corruption scandals and currency devaluation. New car sales are down about 17 percent year-on-year.

The country’s per capita income is among the highest of African countries, reaching an all-time high of $7,609.54 USD in 2013, according to Trading Economics. Elsewhere on the continent, income is still relatively low.

As a result, demand for vehicles is mostly met by a robust used-car market throughout the continent including South Africa, according to Abdul Majeed, an assurance partner at PricewaterhouseCoopers, one of the Big Four auditors.

Auto manufacturing, on the other hand, is a bright spot in the South African economy.

South Africa plays an important role as an African auto production hub. Finished vehicles are shipped out from here to 85 destinations including the U.S., U.K., Japan, France and Australia, Majeed said in a Business Online report.

South Africa is expected to continue leading African auto production, increasing from 584,000 vehicles in 2015 to 690,000 in 2022, according to PwC Autofacts. However, its share is expected to shrink as other regions ramp up production:

Nigeria, for instance, is projected to nearly triple light vehicle production from 27,000 units in 2015 to 75,000 units over the next seven years. Morocco, likewise, is expected to see numbers grow from 288,000 units to 423,000 in 2022 while Algeria will grow from 19,000 to 112,000 units. Egypt is projected to nearly double output from 89,000 to 153,000 vehicles in 2022.

A motor show to invigorate the industry

Africa accounted for just over 0.9 percent of global automotive production in 2015, according to Deloitte Africa Automotive Insights 2016.

“Our industry may be small by international standards but we believe something like this (Cape Town Motor Show) will do its part to help get it back on track,” Rhoda told AFKInsider. “That’s why we’re doing this — to invigorate the industry.

“Not only will we excite the local market but we hope to attract international guests,” Rhoda said.

Described as the largest entertainment destination of its kind in South Africa, the GrandWest venue chosen for the motor show is home to Cape Town’s only casino.

January is peak summer tourist season in Cape Town. Visitors flock there for the weather, beaches, food and wine. “The motorshow adds something quite unique and different,”  Rhoda said.

Rhoda is expecting 35,000 people to attend the motor show. Here are some exhibits and entertainment you can expect to see there:

  • Domestic and imported passenger cars, bikes and trucks, sport utility vehicles, and experimental or concept cars.
  • Accessories.
  • Competition vehicles.
  • Vintage and collector cars.
  • Engine modifications (pimped-up rides)
  • Sound-off beats competitions.
  • Virtual simulations.
  • Car wrapping.
  • Live music, food and entertainment.

Based on ticket sales so far, motor enthusiasts from all over South Africa plan to attend, Rhoda said. Tickets are 100 rand (less than $7.50 US) for adults but it’s a family show, Rhoda is quick to add.

“It’ll also be a good opportunity to showcase our food,” Rhoda said.

Local brands in bike apparel and car accessories will be showcased at the Cape Town Motor Show.

One example is Shelby South Africa, a new company that sprang up in response to the arrival of Ford’s new right-hand-drive Mustangs, which hit South African streets in December. Ford said at its South Africa launch in December that 35-to-40 cars would be arriving in the country monthly.

Shelby customizes Ford Mustangs. “They see our show as an important marketing piece,” Rhoda said.

Jaguar Land Rover plans to be there, along with BMW and Mini and Audi. For bikers, Harley Davidson will be there. “All the international brands you’d expect to see,” Rhoda said. “We’d like to have a Lamborghini…”

Owning a new car in South Africa isn’t becoming easier, Rhoda said. An exchange rate that favors the dollar doesn’t help. The motor show will be important in appealing to the aspirational hopes and dreams of South African drivers.

People interested in attending the Cape Town Motor Show may not be in the market for a new car, Rhoda said. “They may have a second-hand car. But people are hungry. People always want to drive a better car. The mood is very positive.”