How much you need to earn to finance the cheapest BMW, Audi, and Mercedes in South Africa
The prices of new cars have increased substantially in South Africa, and those wanting to finance the cheapest models from Audi, BMW, or Mercedes-Benz will have to be among the top 7% of the country’s income earners.
The latest TransUnion Vehicle Pricing Index (VPI) shows that the price of new vehicles outstripped inflation year-on-year in the second quarter of 2023.
The index measures the relationship between the increase in vehicle pricing for new and used vehicles from a basket of passenger vehicles incorporating 15 top-volume manufacturers.
According to the report, the price of new vehicles, on average, increased by 6.7% in Q2 2023 – beating inflation by 1.3%, which was recorded at 5.4% in June 2023.
The price increases in three segments further exceeded CPI, and the price of all new vehicles is forecasted to increase in the coming months, noted the report.
On average, the price of all body types increased over the period, with medium SUVs and hatchbacks seeing the steepest increases at 7.4% in Q2 2023. Other YoY price increases included Small SUVs (6.8%), premium and hybrids (6.6%), Crossovers (6.4%), and Electric (3.1%).
Unsurprisingly, the cheapest cars from some of the most popular luxury brands are hatchbacks, which saw the steepest price increases year-on-year.
Some of the most popular luxury brands in South Africa are Audi, BMW, and Mercedes-Benz, with the cheapest models from these manufacturers priced at well over R500,000 – except the Audi.
The most affordable German luxury car is the Audi A1, with a price tag of R482,400, while the most expensive is the Mercedes-Benz A-Class, starting at a price of R796,559.
Assuming a payment term of 60 months (five years), at a lending rate of 11.75% and a 0% deposit, the monthly instalment amount of the Audi A1 is roughly R10,765.
Experts still recommend that prospective car owners spend no more than 25% of their monthly income on vehicle finance – meaning you’d have to earn no less than R43,060 per month to afford the cheapest car on this list.
According to the World Inequality database, this puts you in the top 7% of income earners in South Africa – meaning 93% of the country’s population earns less than you.
The cheapest Audi, BMW, and Mercedes-Benz are listed below – including the starting price, estimated monthly instalment, and the monthly salary required to afford the vehicle.
Audi A1
- Starting price: R482,400
- Monthly instalment: R10,765 pm
- Estimated monthly salary required: R43,060 pm
BMW 1 Series
- Starting price: R691,072
- Monthly instalment: R15,381
- Estimated monthly salary required: R61,524
Mercedes-Benz A-Class
- Starting price: R796,559
- Monthly instalment: R17,714
- Estimated monthly salary required: R70,856
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