Deciding on a economic adviser

A lot of Australians will make use of a financial adviser’s services at some point in their life but various advisers come with distinct levels of qualification, knowledge, and objectivity. This makes it very important to investigate any adviser you are contemplating employing in regards to these variables.

How can I assess the top quality of any provided economic adviser?

Your initial port of contact ought to be the new Australian Securities & Investments Commission (ASIC) monetary advisers register. It gives a (potentially incomplete) list of “people who give private tips on investments, superannuation and life insurance”. While the register is not extensive, only a little quantity of men and women are not on the register, creating it a good very first cease for assessing any financial adviser(s) you’re hunting at.

Also worth a look is Adviser Ratings an independent internet site exactly where you can both rate a financial adviser you’ve had dealings with, and look at the ratings received by any monetary adviser(s) you may possibly be thinking about employing. It can also help to find a quantity of advisers to suit your particular requirements and requirements, from which point you can pick the one that appears like the best adviser for you.

What need to I ask the adviser just before I engage their solutions?

While numerous of the inquiries you will need to ask a financial adviser will be distinct to your person circumstance, the ASIC website has an extensive list of questions you must ask in order to assess whether or not the adviser you are speaking to is worth continuing with. Here are 10 of the more basic-objective ones, to give you an idea of the sort of questions you ought to be asking.

1. What are your qualifications?


2. Are you authorised to give advice on the merchandise you are recommending to me?


3. Can you advise me on my present goods?


4. What is your encounter as a monetary advisor?


5. Are you a member of any market associations and/or specialist bodies?


6. How do you hold up to date with alterations that may affect your clients?


7. How do you get to know a new client?


8. How are you paid, and what is your guidance likely to expense?


9. Do you get paid for selling me a certain product? What about any ‘soft dollar’ rewards you may receive?


10. What fees or other positive aspects do you obtain for referring me to one more particular person or business?

As extended as you do your due diligence and assess your possible monetary adviser completely and carefully, you’ll have a better possibility of ending up with a financial adviser who’ll give you with the best and most suitable guidance feasible.

Deciding on a economic adviser

Vehicle sales numbers surprise in September despite challenging economic environment

“Despite the surprisingly better than expected sales results for September, the fundamentals have not changed, the economic outlook is still not looking positive, the rand continues to weaken which will undoubtedly continue to drive above-inflation new car increases. As expected, the export market continues to outshine the rest of the industry and this trend will continue for the remainder of 2014.”

 

General Comments on September 2014 NAAMSA sales:

• The month of September 2014 experienced a 9.26% increase in sales compared to August 2014.


• Month on Month only Passenger (13.10%) and Light Commercial Vehicles (1.70%) experienced positive growth.


• Year on Year monthly comparison shows an increase of 11.51% in September 2014 compared to September 2013.


• Year to date (January – September 2014) comparisons shows that vehicle sales are down by -2.5% in the first 9 months of the year when compared to last year.


• Month on month Exports decreased in September (-6.7%) with Passenger vehicles increasing by 13.8% and Light Commercial Vehicles growing by 42.1%.


• Year on year monthly comparison shows an improvement in exports of 257.9% in September 2014 compared to September 2013.


• AMH & AAD saw an increase in September 2014, 6.3% month on month.

General Comments on September 2014 Standard Bank VAF Personal Applications:

• In September 2014 applications for new vehicles experienced negative month on month growth of -1.1% while applications for used vehicles had negative month on month growth of -2.9%.


• Year on year monthly comparison on applications shows a decline in both new (-34.0%) and used (-1.4%) vehicle market applications in September 2014 compared to September 2013.


• Applications in both Passenger Vehicles (-2.5%) and Light Commercial Vehicles (-2.3%) in the Personal market had negative month on month growth in September 2014.


•  Year on year monthly comparison shows positive growth for both Passenger Vehicles (0.8%) while Light Commercial Vehicles had negative growth (-3.1%) in September 2014.


• The proportion of applications with RV’s increased to 19.7% in September 2014 from 19.2% in August 2014. However, month on month applications with RV’s declined by 2.0%.


• The proportion of applications with deposits decreased to 33.3% in September 2014 from 39.2% in August 2014. Applications with deposits declined by -17.0% month on month.


• The Average Contract Term on applications increased from 67.0 months to 68.5 months (September 2013 to September 2014), year on year growth of 2.4%.


• The average application size increased from R189 755 in September 2013 to R209 865 in September 2014, a 10.6% year on year increase.

General Comments on September 2014 Standard Bank VAF Personal New Business:

• In September 2014 new business experienced negative month on month growth in new vehicle markets of -12.5% while the used vehicle markets had positive month on month growth of 9.1%.


• New business year on year comparisons shows a decline in both new (-34.3%) and used (-19.6%) vehicle markets in September 2014 compared to September 2013.


• Passenger vehicles had negative month on month growth of -11.5% while Light Commercial vehicles had negative growth of -4.2%.


•  Year on year monthly comparison shows a decline for both Passenger Vehicles (-15.5%) and Light Commercial Vehicles (-18.2%) in September 2014 compared to September 2013.


• The proportion of new business deals with deposits decreased to 43.3% in September 2014 from 45.5% in August 2014 (0.7% month on month decline and -44.1% year on year increase).


• The proportion of new business deals with RV’s stayed the same at 25.6% between August and September 2014. New business deals with RV’s declined month on month by -2.7% and -28.7% year on year.


• The Average Contract Term increased from 64.5 months in September 2013 to 66.2 months in September 2014 (2.7% year on year growth).


• The average deal size increased from R260 966 in September 2013 to R288 606 in September 2014, a 10.6% year on year increase.

General Comments on Standard Bank Personal VAF Book:

• Personal Market book shows new vehicle market decreased from 57.5% in September 2013 to 55.8% in September 2014, while used vehicle market increased from 42.5% in September 2013 to 44.2% in September 2014.


• Passenger Vehicles marginally increased from 89.2% in September 2013 to 88.7% in September 2014 while Light Commercial Vehicles increased from 10.3% in September 2013 to 10.8% in September 2014.

Nicholas Nkosi – Head of Standard Bank Vehicle and Asset Finance – Personal Markets

General Macro and Industry Comments:

• The SARB left the repo rate unchanged at 5.75% following its September MPC meeting. The outcome was in line with the industry’s forecast. According to Standard Bank this was based on the SARB’s revised forecasts for headline inflation.


• Headline annual inflation rate (CPI) in August 2014 was 6,4%.  This rate was 0.1 of a percentage point higher than the corresponding annual rate of 6.3% in July 2014. On average, prices increased by 0.4% between July 2014 and August 2014. Transport index increased by 0.4% between July 2014 and August 2014. The annual rate decreased to 6.1% in August 2014 from 6,9% in July 2014.


• The SARB expects headline CPI inflation to average 6.2% in 2014, falling to 5.7% in 2015 and 5.8% in 2016, as opposed to their forecast in July of 6.3%, 5.9% and 5.6% in the respective years. Inflation was revised lower due to lower expected food and petrol prices.


• The change in the SARB’s outlook for inflation is significant in that they no longer expect inflation to peak in Q4:14, and estimate that the peak has already happened, in Q2:14 at 6.5% y/y.


• In addition, the length of time that the SARB expects inflation to remain outside of the target band has shortened, they expect it will fall below 6.0% in Q1:15 as opposed to in Q2:15.


• Growth was also revised lower, from 1.7%, 2.9% and 3.2% y/y in 2014, 2015 and 2016 respectively to 1.5%, 2.8% and 3.1%. Standard Bank expects GDP for 2015 and 2016 to continue to disappoint to the downside. The SARB has lowered its growth forecast for 2014 successively at each of the last 6 meetings (starting from 3.3% at the September 2013 meeting).


• Fuel prices have risen by 0.5% in petrol (inland) and dropped by -3.2% in diesel (inland) since Jan 2014 to October 2014. Further, the price of fuel in the country has gone up by 28.8% in petrol and up by 21.2% in diesel since Jan 2012.


• The price of 93 Octane Petrol will be increasing by 2 cents from the 1^st of October 2014. The price of 95 Octane fuel will be decreasing by 5 cents while both grades of Diesel will see a drop of 13 cents.

Fuel Types

• In the month of August 2014, Petrol vehicle sales had negative month on month growth (-5.6%) while Diesel vehicle sales had positive month on month (1.0%).


• Year on Year August 2014 versus August 2013 Petrol vehicles declined by -2.1% while Diesel vehicles declined by -0.1%.


• Year on Year YTD comparison for 2014 shows that Petrol vehicle sales declined by -6.6% while Diesel vehicle sales increased by 0.2%.

Also view:

Vehicle Finance, Car Insurance and Road Safety

Buying and Selling a Vehicle – Informed decisions and the Vehicle Retailer

;

Vehicle sales numbers surprise in September despite challenging economic environment

NAAMSA vehicle sales report for May reveals vehicle retail vulnerability in low economic growth

;

General Comments on May 2014 NAAMSA sales:

• The month of May 2014 experienced a 7.41% increase in sales compared to April 2014.


• Month on Month all goods types experienced positive growth.


• Year on Year monthly comparison shows a decrease of -9.22% in May 2014 compared to May 2013. The average sales per day in May 2014 were less than May 2013 (1,979 vs 2,096 at 25 business days and 26 business days respectively).


• Year to date (January – May 2014) comparisons shows that vehicle sales are down by -5.89% in the first 5 months of year when compared to last year.


• Month on month Exports decreased significantly in May (-7.05%) with Passenger and Bus being the main contributors, although in comparison to May 2013, there was a decrease of 40.5% in exports experienced.


• AMH & AAD saw an increase in May 2014, although at a slightly low percentage of 1.95%.

General Macro and Industry Comments:

• The country’s Q1:14 Gross Domestic Product slowed to 1.6% y/y from 2.0% in Q4:13 and from 3.8% q/q in Q4:13 to 0.6% q/q in Q1:14. Standard Bank Research has revised its GDP forecast for 2014 to 2.0% down from 2.1%.


• The MPC left the repo rate unchanged in the third week of May from the 0.50 bps rate hike in the beginning of the year (end January).


• Headline annual inflation rate (CPI) increased from 6.0% y/y in March 2014 to 6.1% y/y in April 2014. On average, prices increased by 0.5% between March 2014 and April 2014. Transport index increased by 0.4% of a percent point between March 2014 and April 2014, this was mainly due to a 5c per litre increase in petrol price. The annual rate decreased to 6.8% in April 2014 from 6.9% in March 2014.


• Standard Bank research commented in addition, new vehicle price inflation accelerated to 7.0% y/y in April, from 6.7% y/y in March, which could be on the back of the weaker currency.


• Fuel prices have risen by 34.3% in petrol (inland) and risen by 26.5% in Diesel (inland) since Jan 2012 to May 2014. Fuel prices have risen by 82.7% in petrol (inland) and risen by 88.6% in diesel (inland) since Jan 2010 to April 2014. Further, the price of fuel in the country has gone up by 287% in petrol and up by 417.2% in diesel since Jan 2001.


• All of these factors are expected to hinder vehicle sales growth.

Factors that will inhibit growth include the following:

• Low level of economic growth is expected in 2014, 2.0% for 2014 (Standard Bank Research).


• Rising inflationary pressures will remain a challenge. Food, fuel, above inflation wage settlements, as well as exchange rate fluctuations will pose risks to the inflationary outlook.


• Exchange rate fluctuations will also have an impact on vehicle pricing. With 2 thirds of vehicles sold in RSA being imported (NAAMSA) pricing will be vulnerable to a depreciating Rand.


• The vehicle replacement cycle may have reached its peak, putting further dampening pressure on sales growth.

South African Vehicle Exports: (1st Quarter)

• From the first quarter of 2014 to the first quarter of 2013 export volumes decreased by 16.42%. This equates to 11,867 less vehicles exported in the first 3 months of 2014 compared to 2013.
• PAS vehicles (48.9%) and LCV’s (50.7%) together made up 99.6% of total vehicle exports in the first quarter 2014.
• These seem to suggest that PAS are in decline, with a decrease of 6.43% from 2012 to 2014 while LCV’s increased by 15.74% during the same period.
• As at the end of the 1st quarter of 2014 South Africa’s largest trading continent in terms of vehicle exports was Europe with 37%, followed by Africa with 32%, and North America with 17%. Asia and Australasia.
• Even though Exports decreased overall, Africa and Europe have both increased in their percentage contribution of vehicles being exported from South Africa, growing by 14.65% and 16.04% respectively. Asia and North America declined by -8.05% and -33.62%.
• In terms of volumes South Africa exported 20,495 vehicles into Africa in 2013 compared to 19,639 in 2014 showing a 4% decrease. Europe had 23,013 vehicles imported from South Africa in 2013 decreasing to 22,318 vehicles in 2014 showing a 3% decrease.
• The decrease in export volumes could be due to the Mercedes-Benz C-Class model not being exported in the first half of the year.
• The key driving factor in the decrease in the number of vehicles exported into Africa may be down to the decrease in the number of Light Commercial Vehicles (LCV) being exported. LCV’s grew by 18.35% from 2012 to 2013 (15,019 to 17,775), however, in 2014 LCV’s declined by 14.41% from 2013 (17,775 to 15,214). Of the total vehicles exported into Africa LCV’s made up 83% and 87% in 2012 and 2013 respectively, this has dropped to 78% in 2014.
• Although Europe’s total % contribution has increased over the years we can see that the percentage split of Passenger vehicles have decreased from 56% in 2012, to 48% in 2013 and 38% in 2014. The decrease in Europe’s Passenger vehicle imports is due to the increase in volume of LCV vehicle exported. In the first 3 months of 2012 South Africa exported 9,287 LCV vehicles to Europe; this has increased to 13,819.

NAAMSA Seasonality and Average Selling Days:

• On average May has ranked the 9th best performing month in the year since 2012. May 2014 had 25 selling days (Mon-Sat), with an average of 1,979 sales per day. May 2013 had 26 selling days, with an average of 2,096 sales per day.
• Between Jan and April 2014 the average selling per day has been 2,104.
• May 2014 has ranked the 44th best performing month out of the last 89 months since January 2007 and 4th best performing month this year.
• The average number of sales for May since 2012 has been 52,270 and the average number of sales for May since 2010 has been 45,677.

New vs Used Deals – SBSA vs Trans Union

• VAF saw a decline in application volumes from November 2013 to December 2013 for both new (18%) and used (19%), this then increased again from December 2013 to January 2014 (New – 11% & Used – 16%) and has subsequently remained flat during April 2014.
• Comparing TransUnion April 2014 to YTD April 2013, there is an increase of 21% in new vehicle sales and an increase of 20% in the used vehicle market.
• The new to used ratio in the market is showing an upwards trend, with currently 1.67 used cars being sold for every new.

[ Comments on NAAMSA New Vehicle Sales Report - May 2014 by Nicholas Nkosi – Head of Standard Bank Vehicle and Asset Finance - Personal Markets]

Also view:

Buying and Selling A Vehicle : Informed Decisions and the Vehicle Retailer

Vehicle Finance and Road Safety

;

NAAMSA vehicle sales report for May reveals vehicle retail vulnerability in low economic growth