Auto sales dip in Q1 after last year’s spike

New vehicle sales dipped slightly to March, though industry officials say the dip does not reflect a longstanding trend.

Data from Kenya Motor Industry Association (KMI) released Monday showed that total sales for industry’s Q1 (Jan-March) were 3,671, down 15 per cent compared to 4, 299 units sold in a similar period last year.

General Motors EA accounted for more of the total units sold by 1,149 – representing 31 per cent, helped by pick up and commercial class of business.

Industry analysts have attributed the drop to high bank loans and a slowdown in the sales of commercial vehicles which account for more than 70 per cent of all construction business in the country.

“This can be explained by the lessening of activities in the construction industry currently, which commercial vehicle dealers heavily rely on,” said Stephen Mbuthi, a motor expert.

This marks a departure from the performance during the last quarter of 2015 when a huge appetite for used cars pushed up sales. Data from Kenya Bureau of Statistics (KBS) shows 68, 489 family cars – saloons and station wagons were sold last year alone.

The decline in the auto sales for the period under review further mirrors a dip in the number of vehicle imports sold last year – where import sales declined for the first time in five years in what motor dealers linked to the increase in excise taxes on popular models.

Vehicles discharged from the port of Mombasa condensed by eight per cent to 143, 833 units in 2015 against 157,856 units cleared the year earlier, this is according to figures from Kenya Ports Authority (KPA).

The drop was attributed to a slowdown in imports of small second hand cars originating from markets like Japan and UK.