Vehicle sales set to hit 16 500

Namibia's vehicle market is on track to sell between 15 500 and 16 500 units this year, despite rising fuel prices, vehicle running costs and borrowing costs, according to Simonis Storm.

The research firm said the market had maintained enough momentum to support its full-year forecast, with sales reaching 10 760 units in the first eight months of 2026.

That represents a 12.1% increase from the same period last year.

Simonis Storm said the market would need to average between 1 185 and 1 435 vehicles a month from September to December to reach its forecast.

That remains within the recent trading range of about 1 200 to 1 600 units a month.

August recorded 1,380 vehicle sales, an 8.6% increase from August 2025 but a 10.1% decline from July.

The research firm said the monthly decline should not be viewed as the beginning of a slowdown.

"What August actually tells us is narrower than the headline suggests: this is normalisation after an unusually strong July, not the start of a slowdown," Simonis Storm said.

It said the more important indicator would be whether September sales returned to the underlying run rate of more than 1,200 units a month.

Rising ownership costs

While vehicle sales remain resilient, Simonis Storm said the cost of owning and operating a vehicle was becoming a greater concern.

Namibia's annual inflation rate rose to 5% in August from 4.4% in July, with transport costs accounting for a significant share of the increase.

Transport inflation rose to 13.2% from 9.3% a month earlier.

Fuel inflation reached 25.1% year-on-year, compared with 15.5% in July.

However, Simonis Storm highlighted a broader measure of vehicle ownership costs, which includes vehicle operation, spare parts, maintenance, licences and insurance.

That category increased by 17.1% year-on-year in August, from 11.3% in July.

"That last figure matters more for this report's audience than the pump price alone," the firm said.

It described the increase as "the clearest evidence yet that the cost of owning and running a vehicle in Namibia, not merely buying one, is rising sharply".

The firm said the higher costs could affect vehicle replacement cycles, with households and fleets potentially keeping existing vehicles for longer rather than trading up.

Fuel pressure persists

The pressure on motorists continued into September.

A fuel-price adjustment that took effect on 2 September increased petrol by 60 cents a litre and diesel by N$1.60. The Road User Charge levy also increased by 30 cents.

Simonis Storm said Brent crude had risen to about US$99.85 a barrel, up 17% in one month and 50% year-on-year.

It expects transport inflation to remain elevated.

"Our own view is that the transport consumer price index is now more likely to test or exceed the June 2026 cycle high of 12.9% than to return toward single digits before year-end," it said.

The firm therefore said the August increase in vehicle ownership costs should be regarded as "a floor for the rest of 2026, not a peak".

Venus could lift 2027 sales

Simonis Storm expects the vehicle market to expand further in 2027, although the strength of that growth depends heavily on the TotalEnergies Venus oil project.

If the project reaches final investment decision and mobilises on schedule, the firm forecasts vehicle sales of between 17 000 and 19 000 units in 2027.

If the decision is delayed, its forecast falls to between 15 000 and 17 000 units.

Simonis Storm estimates that a positive Venus decision could be associated with a multi-year capital programme of between N$180 billion and N$220 billion.