The Cheapest Car in South Africa Becomes Even More Affordable

The new Toyota Vitz debuted in South Africa in April 2023 as the cheapest car in the market. And right now, for a brief period of time, the small Suzuki-based hatchback has become even less expensive.

Related: Suzuki Celerio-Based Vitz is the Cheapest Toyota in South Africa

The Toyota Vitz line-up now costs exactly ZAR 20,000 less thanks to a special discount offer, according to the company’s local website. This means that the base 1.0 manual version is now priced at ZAR 169,900 (PKR 25.43 lac) making it even more affordable than before. The discount also applies to the up-spec 1.0 XR variants, which can now be bought for ZAR 199,900 (PKR 29.92 lac) for the manual and ZAR 214,900 (PKR 32.17 lac) for the automatic version.

Toyota Vitz 2

Bear in mind, the new Vitz in South Africa is based on the latest generation Suzuki Celerio, thanks to a Toyota-Suzuki collaboration that allows the two automakers to badge-engineer a number of models. However, the older generation Celerio which is sold under the Cultus nameplate in Pakistan sells between PKR 37.18 lac and a whopping PKR 43.66 lac. This means that the new generation Celerio-based hatchback in South Africa is actually up to Rs 12 lac cheaper than the obsolete Celerio-based feature-ripped model in Pakistan. More importantly, the top-spec variant in South Africa comes for around Rs 5 lac cheaper than the bone-stripped base variant Cultus here.

Toyota Vitz 900x600

In Pakistan, the Suzuki Cultus is among the most severely impacted by a catastrophic decline in sales. Cultus saw 23,169 units sold in FY22 but only managed to see 6,956 units leaving the showroom floors in the recently concluded FY23, rendering a deplorable 70% decline. As of the first 6 months of this calendar year, only 1,813 units of Cultus have been sold averaging an appalling 302 units a month. In comparison, 8,653 units were sold during the first 6 months of CY2022, averaging 1,442 units a month. This shows an even worse 80% decline in sales average.

Related: Not the Ideal Start to New Fiscal Year for Local Assemblers

The beginning of the current fiscal year isn’t very favorable for Suzuki Cultus like it is for the majority of locally assembled automobiles. Only 177 units were sold in July 2023 while not a single one was produced which is due to the lack of CKD parts in hand amid import restrictions imposed by the government. The company is battling with depleting inventory and has been observing non-production days in regular intervals since August of last year.

Cultus white ft

Despite such awfully declining sales, Pak Suzuki’s revenue per unit sold increased to 76% thanks to successive substantial price hikes made within the last year or so. Despite claiming to have achieved a high level of localization, local assemblers have been increasing prices in tandem with currency depreciation and most recently, announcing price revisions without mentioning any reason. This won’t be a long-term strategy, though, as any subsequent price hikes will be like hammering one’s own leg with a spade.

Related: 6M-2023: Top 10 Bestselling Cars in Pakistan

Car financing is no longer a viable option to purchase a new car, and no one is willing to spend a hefty amount in cash for ordinary hatchbacks that cost above the territory of Rs 4 million. Those who have the luxury to spend cash on new cars usually go for crossovers & SUVs and not small Suzuki hatchbacks. Perhaps Pak Suzuki needs to understand this.

Selling 177 odd units of Cultus a month renders 2,124 units for a year if sales stay this way. Not to mention Suzuki Cultus peaked at 23,169 units in FY22 which shows the current sales average is 90% less than what it used to be last year. Whether Pak Suzuki will further increase its prices to dampen its losses, or ‘wait’ for the economic scenario to settle down which doesn’t seem to be happening in the near future. Else take some notes from Suzuki Celerio and Celerio based-Vitz in South Africa and try reducing profit margins per vehicle to boost sales.

vitz sa

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