A total of 910 vehicles were sold in January, representing a 14,6 percent drop from the 1,066 vehicles sold in December last year, IJG Securities has reported.
The January figure is also 34 percent lower than the 1,379 vehicles sold in January 2016.
About 16,598 new vehicles were sold last year, compared to the 21,246 vehicles sold over the previous calendar year.
According to the report, new vehicle sales have been contracting on a year-on-year basis since mid-2015.
The slowdown has been felt in both passenger and commercial vehicles, with passenger vehicle sales down 26,4 percent year-on year and commercial vehicle sales down 39 percent. Within the commercial vehicle segment, the light commercial category, which makes up the bulk of sales, has decreased by 39,4 percent year-on-year, while medium commercial vehicles sales have decreased by 25 percent year-on-year.
Heavy commercial vehicle sales have also decreased by 37,5percent year-on year.
Passenger vehicle sales decreased by 8,6 percent month-on-month to 402 vehicles in January, while commercial vehicle sales decreased by 18,8 percent month-on-month to 508.
Of the 508 commercial automobiles sold, 478 were classified as light, 15 as medium and 15 as heavy commercial.
The total number of passenger and commercial vehicles sold in 2016 were 7,006 and 9,592 respectively.
It is likely that even lower numbers will be seen during the 2017 calendar year, if the January figures are anything to go by.
In 2016, Toyota and Volkswagen dominated the passenger vehicle market, with the two brands claiming 29 percent and 28 percent of the market, respectively.
They were followed by Ford at 7 percent and Mercedes at 5 percent, while the rest of the passenger vehicle market was shared by several competitors.
The start of 2017 points to this trend continuing, as Toyota and Volkswagen have again taken the lead in terms of the number of new vehicles sold.
Toyota also remained the leader in light commercial vehicle sales, with 49 percent of the market, followed by Nissan at 16 percent.
Isuzu and Ford claimed 13 percent and 11 percent, respectively, of the number of light commercial vehicles sold in January, which is very much in line with the market share observed in 2016.
In the heavy category, Hino and Mercedes started off the year by selling four heavy or extra heavy vehicles each, or 27 percent of the number of heavy commercial vehicles sold over the month.
Heavy commercial vehicle sales have dropped to multi-year lows, which can be seen as a drop in investor or business confidence.
The new vehicle market in Namibia has been in a state of decline since mid-2015, and this trend seems to be continuing.
The reduction in Government spending has had a direct and indirect effect on the demand for new vehicles, with both direct orders from Government, and the weaker economic environment, reducing the demand for capital goods.
Furthermore, higher interest rates and amendments to the Credit Agreement Act, which requires a deposit of 10 percent on all vehicle loans and limits repayment periods to 54 months, have reduced the availability of credit used to purchase.
“We expect the slowdown in new vehicle sales to continue into 2017, as the full effect of interest rate increases and cuts in public spending filter through to all areas of the economy,” the IJG Securities report said.