Overall confidence levels among the dealers increased to 6.4 points in the first quarter of 2012 out of 10 points, compared with 6.1 points in the previous quarter, WesBank's survey showed.
"It must be remembered that 2011 saw exceptional growth in new vehicle sales.
"As a result, single digit growth is still very positive and should be welcomed by the automotive industry given that we are coming off a comparably high base," said Chris de Kock, executive head of sales and marketing at WesBank.
De Kock said an improvement in affordability, with manufacturers continuing to launch new models at better prices and new car prices growing significantly slower than those of used vehicles lifted confidence levels during the quarter under review.
"To put this in context, the CPI on new vehicles has decreased from 8.7% in the fourth quarter of 2009 to just 4% for the same period in 2011.
"As a result, we are seeing a continued shift by consumers from used to new vehicles."
Other economic data also point to an improved outlook for consumers. Recent statistics by the National Credit Regulator show a rise in the number of consumers in good standing from 10.04 million in June 2011 to 10.27 million consumers in September.
Insolvencies among private individuals have also consistently reduced in recent years - all good indications that consumer spending will remain positive, he said.
"This is further supported by WesBank book data that shows an increase of more than 6% in monthly applications in January 2012 to 98,000, compared to the same month last year."
On the main factors that may prevent consumers from completing a purchase, 7.5% of dealers cite interest rates, up from just 3.3% in the previous quarter.
"The low interest rate environment has supported sustained growth in the local automotive industry during the last year and we expect this low rate cycle to continue for most of 2012.
"However, speculation of a possible rise in interest rates later in the year may act to curb consumer buying down the line," De Kock said.
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