Are you looking to buy a car? Aren’t cars expensive to buy these days? There has never been a greater need for affordable motoring. South Africa is experiencing weak economic growth, which puts more financial pressure on South Africans. With interest rates and petrol prices increasing, it’s making the decision to buy a new car more challenging than ever before.
In this article we have a look at some affordable new cars that are available and how you can go about purchasing one.
What are the Cheapest New Cars in South Africa In 2019?
Below we have listed the cheapest new cars currently available in South Africa.
These cars are all priced under R162,000 and a potential buyer could pay up to R3,000 per month over 72 months, with no deposit or residual and an interest rate of 10%.
These vehicles have a minimum safety requirement of two airbags and ABS brake system.
- Mahindra KUV100 NXT K2+: Starting from approximately R134,999. The estimated price per month is R2,199. 1
- Suzuki Celerio 1.0 GA/GL: Starting price is in the region of R139,900. The estimated price per month on the GA model is R2,592 and for the GL model is R2,907pm.1
- Datsun Go 1.2: Starting price is roughly R144,500. The estimated price per month is R2,677 - which includes 1-year free insurance as part of the deal. 1
- BAIC D2 1.3 Comfort: Starting from approximately R149,900. The estimated price per month is R2,779. 1
- KIA Picanto 1.0 Street: Starting from about R158,995. The estimated price per month is R2,946. 1
- Tata Bolt 1.2T XMS: Starting from approximately R159,995. The estimated price per month is R2,964. 1
- Suzuki Swift 1.2 GA: Starting from about R160,900. The estimated price per month is R2,981. 1
- Suzuki Dzire 1.2 GA: Starting from roughly R161,900. The estimated price per month is R2,999. 1
Why Buying a New Car could be a Good Decision?
- Reliability: A new car come straight from the factory, has had a full inspection and has a full factory service and warranty plan. 2
- Finance: Banks will always give you a better interest rate on a new car than a used car. 2
- Variety: You have the freedom of choice when it comes to choosing the make, model, trim, accessories, etc on a new vehicle. 2
- New technology: New cars usually come with the latest technology – mechanically and electronically. Lower fuel usage, Bluetooth connectivity, safety features, etc. 2
How to Finance your New Car?
Before you apply for finance on your new car, make sure that you know what your budget is and how much extra money you have for a new vehicle every month. When you do your research for a new car, this will help you stay within your budget. 2
Also, remember to get car insurance before you finalise the purchase of your new car. It will be a contractual requirement to have an active comprehensive car insurance policy when buying a new car. 2 PMD (prime Meridian Direct), for example, offers affordable comprehensive car insurance with fixed premiums*, which includes R1 million 3rd-party liability protection and excess that reduces to zero* over time. *T's&C's apply. 3
There are other additional costs you must factor in, including the licencing and registration fees, as well as the administration fees that the dealership may charge for preparation and delivery of your new car. 2
What Is Required to Finance your New Car?
- A valid driver’s licence – this is for FICA purposes. 2
- Valid proof of address – this is also for FICA purposes. 2
- You will need to provide your latest payslips and bank statements – this is to check your affordability on a new car. 2
Please keep in mind that you will have a full credit check by the F&I of the dealership. They will advise you on what you can afford and if you qualify for finance on the motor vehicle. 2
Car-Buying Jargon Explained
- NCA: National Credit Act.
- FICA: Financial Intelligence Centre Act.
- Deposit: A payment upfront that will help lower the amount of money borrowed and therefore reduce your monthly payments.
- Balloon/ Residual: This is a large amount of money owed at the end of the car’s contract which, if you choose it, will lower your monthly payments.
- Interest Rate: The interest added on to the car loan.
- Contract Term: The amount of time over which you choose to pay off your car. 12 months – 72 months.
- Credit Score: Banks use this score to check your affordability on a new car.
Whatever the new car you choose, I hope this gives you a reasonable guideline to do so.