NAIROBI, Kenya- In a trend that’s shaking up Kenya’s automotive market, dealers of new vehicles, especially luxury brands, are facing a significant slump in sales.
As Kenyans increasingly opt for more affordable second-hand imports, brands like BMW, Range Rover, and Land Rover are seeing record-low showroom activity.
Industry data paints a stark picture: high-end car sales have hit rock bottom.
In June, luxury car showrooms across Kenya reported dismal sales figures. Brands such as BMW and Range Rover recorded zero sales.
British automotive distributor Inchcape sold just two new Range Rovers and five BMWs in the first half of the year.
Land Rover sales were also bleak, with only 10 units moved. Mercedes fared slightly better with 15 units sold, primarily commercial vehicles like trucks and buses, while saloon car sales remained stagnant.
This downturn is reflected in the broader market, where new vehicle sales dropped by 12.6pc in the first half of the year. The Kenya Motor Industry Association (KMIA) reports that the 11 main dealers sold 4,982 units, down from 5,697 in the same period last year.
While new vehicle sales struggle, second-hand imports continue to thrive. Kenya imports an average of 6,000 to 8,000 second-hand vehicles monthly, largely due to their affordability.
New cars start at about Sh2.5 million, whereas used cars cost between Sh800,000 and Sh1.5 million for low-capacity models.
This price disparity drives many Kenyans to opt for imported used cars, mainly from Japan, which accounts for 80pc of these imports. Other sources include the UAE, UK, Singapore, and South Africa.
The Car Importers Association of Kenya (CIAK) highlights that locally assembled units are pricier by more than Sh600,000 compared to imported used cars, which often offer superior features.
Despite efforts to boost local assembly through standards like KS1515:2019 by the Kenya National Bureau of Standards, which aims to tighten import inspections, a pending court case has stalled its implementation.
Despite the challenges facing new vehicle sales, certain segments remain resilient. Isuzu East Africa continues to lead the market, selling 2,354 units, making up 47.3pc of total industry sales.
CFAO Motors Kenya, the result of a merger between Toyota Kenya and DT Dobie, accounted for 32.7pc of sales with 1,630 units. Simba Corp, dealing in brands like Mitsubishi and Mahindra, came in third with 522 units sold.
Trucks dominated sales with 1,754 units sold, reflecting ongoing activity in sectors such as transport, agriculture, construction, and retail.
Pick-ups, particularly from Isuzu and CFAO, saw 1,492 units sold. Medium buses and station wagons also showed notable sales, with 513 and 462 units, respectively.
In the face of these changes, dealers and local assemblers must adapt to remain competitive.
