Global crunch crashes into car owners

Pretoria – Vehicle repossessions by banks in South Afroca are rocketing, with finance market leader WesBank reporting a 93 per cent increase between July and September compared with the same period last year.

Total vehicle repossessions by banks are estimated at between 6 000 to 7 000 units a month, leading to a glut of auctions to dispose of them. The year-to-date increase in vehicle repossessions at other banks from last year is 30 per cent at Absa, 28 per cent at Standard Bank and 10 per cent at Nedbank.Chris de Kock, the sales and marketing director at WesBank, said that it had repossessed 6 563 vehicles between July and September compared with 3 395 vehicles in the same period last year.WesBank’s vehicle repossessions peaked at 2 252 units in August, but declined last month and this month.Repayment arrears had shown a consistent reduction for the past seven months, both in volumes and percentage of WesBank’s total book, although this was off a very high base.John de Beer, the head of Nedbank Vehicle and Asset Finance, said repossessions in terms of voluntary surrenders had not yet peaked and consumers were likely to remain under stress “well into 2009”.Marcel de Klerk, the managing executive at Absa Vehicle and Asset Finance, said repayment arrears had stabilised since April.But he believed repossessions would stay at high levels “for quite some time because all of us [banks] sit with a big part of our business three, four or five months in arrears”.He added: “With consumer debt levels and inflation where they are, I can’t see the consumer’s situation … getting better in the next 12 months.2009 is going to be as bad as 2008 for vehicle financiers and the motor industry.”De Klerk said the National Credit Act (NCA) had permitted private consumers to finance their vehicles over more than 54 months without any deposit.Business ReportThe year-to-date increase in vehicle repossessions at other banks from last year is 30 per cent at Absa, 28 per cent at Standard Bank and 10 per cent at Nedbank.Chris de Kock, the sales and marketing director at WesBank, said that it had repossessed 6 563 vehicles between July and September compared with 3 395 vehicles in the same period last year.WesBank’s vehicle repossessions peaked at 2 252 units in August, but declined last month and this month.Repayment arrears had shown a consistent reduction for the past seven months, both in volumes and percentage of WesBank’s total book, although this was off a very high base.John de Beer, the head of Nedbank Vehicle and Asset Finance, said repossessions in terms of voluntary surrenders had not yet peaked and consumers were likely to remain under stress “well into 2009”.Marcel de Klerk, the managing executive at Absa Vehicle and Asset Finance, said repayment arrears had stabilised since April.But he believed repossessions would stay at high levels “for quite some time because all of us [banks] sit with a big part of our business three, four or five months in arrears”.He added: “With consumer debt levels and inflation where they are, I can’t see the consumer’s situation … getting better in the next 12 months.2009 is going to be as bad as 2008 for vehicle financiers and the motor industry.”De Klerk said the National Credit Act (NCA) had permitted private consumers to finance their vehicles over more than 54 months without any deposit.Business Report