Auto sales lose momentum in November

By Steve Umidha

The pace of Kenya’s auto sales slowed in November, data from analytics firm Kenya Motor Industry Association (KMIA) showed Tuesday, amid a spurt in coronavirus infections.

The monthly adjusted sales for total vehicles sold during the month dropped to 1,044 units from 1,100 units the industry sold in October, bringing the total of vehicles sold across all car makers to 9,792 units since January – which is 2,063 units less, the industry sold in a similar period last year.

Prior to this drop, the auto industry sales had quickened exponentially from July, expanding for the fourth straight month to October before coming to a sudden halt, in what experts say was an expected dip due to the second wave pandemic that also hit numerous manufacturers.

“You could predict this right from the month of October when the number of infections began to escalate and it was clear industries would take a hit as a result, auto industry as well. This trend could continue for the next two to three months before the industry swings back to near normalcy,” commented Trevor Lumenya – automobile expert.

Kenya’s economy has been hit hard by COVID-19, severely affecting industrial output, incomes and jobs. The economy has been exposed through the dampening effects on domestic activity of the containment measures and behavioral responses.

Despite data showing a dip in auto sales for the month of November, Kenya’s auto industry is continuing its improvement from lows in April that were caused by the COVID-19 pandemic when first infection cases were reported.

Most dealers announced improved sales, in a month that has seen Isuzu East Africa sell 3, 885 vehicles to date helped by improving truck business compared to Toyota’s 2,278 units including its HINO division and Mitsubishi’s 1,334 total units sold year-to-date.

December is synonymous with end-year festivities but statistics show that car makers could experience a reduced sale period owing to the ongoing crisis with the majority of the country’s middle class operating on thin budgets.

Financial incomes among the majority of Kenyans fell by double digits between March and June with a good number affected by cuts in wages than in the other nations, according to a survey by GeoPoll – which found that the East African nation had the most widespread income cuts of any of the six African nations polled in November.

Around 52 per cent of the respondents across all six nations reported a large drop in earnings since June, but 64 per cent of respondents in Kenya suffered the same.

Even then, the car market is expected to pick up in the early months of 2021 with the likes of Nissan already planning a major growth strategy with new appointments across its African market which ordinarily have a bearing on the Kenyan market.

Simba Corporation, another big player in the market, is lining up major announcements and big launches in the first quarter of 2021 (Q1) in what could shape the industry in the post pandemic period.