While the MCV return ordsprog

While the MCV return equals the second-best ever monthly result for this segment achieved in May 2005, it was only 40 units below the outright record of 1 216 units set in June, and sustains the tremendous growth spurt being exhibited by this vehicle classification. In their own right, the HCV and EHCV segment results both set new records for these categories since NAAMSA redefined its truck market segmentation parameters at the beginning of 2004.

2005's performance was also 31.7% higher than 2004's total truck sales, with growth experienced in every segment of the market.

The South African truck market, coming off the back of an outstanding 2005 annual result, has continued to achieve impressive monthly returns in both December and January, notwithstanding the fact that these two months normally deliver the lowest total new vehicle sales volumes of the entire calendar year. The main driver of January's excellent result was a strong surge in HCV segment sales, with this grouping of predominantly distribution trade vehicles now returning to market share levels above 20% for the first time in nearly half a decade.

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By the end of October, the cumulative year-to-date total of 22 732 units has already overtaken, by 32%, the highly celebrated result of 20 814 unit deliveries achieved during the corresponding period in 2004 which was, in itself, a post-1982 record for the market.

The sales total of 2,028 units reported to the National Association of Automobile Manufacturers of South Africa (NAAMSA) during December, pushed the year's sales volume to a final grand total of 27,413 units, which was second only to the previous all-time record of 30,742 units that had been established in 1981.

In 2005, we also faced challenges in both our segments. Results in our Senior Segment were impacted by a higher-than-anticipated Medicare supplement loss ratio. Our Medical Segment was affected by increased severity of larger dollar claims. In 2006, we continue to actively address these issues as we remain focused on our ongoing business strategy of growth in our Senior Segment and stability in our Medical Segment.

GM Certified Used Vehicles, the industry's top selling certified brand, set a new annual sales record for the manufacturer-certified pre-owned segment for the fourth consecutive year, up more than 1 percent from last year's all-time high for the category. Certified GM brands again led all manufacturers with 2005 sales of 532,379 units, and we look forward to growing our leadership position in the certified segment in 2006.

The light commercial vehicle (LCV) segment has come in strongly at 15458 units, representing an increase of 23,1% over January 2005, and 22,4% over last month. This indicates that the stock problems experienced during January 2006 have been partially eased.

The full-size car segment is fairly staid, with no new model introductions, according to J.D. Power segmentation. Although retained value improved year-over-year in December, the segment still lags all others. One driver of the increase in retained value is that incentives were higher in December 2005 than December 2004. Higher gas prices may also make these vehicles more appealing to consumers needing more space but also looking for fuel economy.

The year 2005 was truly memorable for participants in the South African truck market. Sales volumes have consistently edged ahead of the most optimistic initial forecasts, and once the trend of strong growth had been established early in the year, the market consistently delivered near-record monthly performances. As it turned out, the year-on-year growth of 31,7% recorded this year completely eclipsed the 27,5% achievement which had, understandably, excited participants at the end of 2004.

This marks the fourth consecutive year that GM Certified Used Vehicles set an all-time annual sales record for the certified segment. Chevrolet continues to be the industry's top-selling single-make certified brand, with total 2005 sales of 292,301 units.

Export volumes continue to boost car production in the UK. Eight in every ten cars made in the UK in November is destined for export markets and we expect the 2005 total to reach record volumes and market share. Overall car output in 2005 should hit 1.6 million units, a little down on 2004 but still a strong performance.

Christopher Macgowan

2005 was a significant year for the company. We also shipped record units during the fourth quarter at an annualized run rate of approximately 30 billion units.

Despite challenging market conditions, we achieved strong profit growth in the fourth quarter driven by healthy, solid results in our key business units and overseas subsidiaries.

We had very loyal customers in the car segment as well before they (Japanese automakers) were here. The Japanese are extremely capable competitors in any segment they decide to enter. We have yet to see someone really fail. There's no reason to believe it'll be that different in the truck segment.

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