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Corporate News

Motor dealers raise stakes in market with fresh brands

Three motor dealers have introduced vehicle brands in the past two weeks, raising competition for customers in the new car segment.

Simba Colt, Toyota Kenya and CMC Motors have unveiled new vehicle brands and models in the past half month, following on General Motors East Africa (GMEA) introduction of four models under its Chevrolet and Captiva saloon car brands six months ago.

The introduction of new brands and models comes as sales in the new-car sector dropped seven per cent to 2,727 units in the first quarter, with total sales this year expected to come under pressure from the high interest rates and the looming general elections.

Simba Colt is set to launch the 2012 BMW 3 series in what is set to intensify competition in the luxury saloon car segment.

The company’s sales of BMW cars rose from 28 units in 2010 to 46 units last year, growing its marketshare in the luxury segment to 23.2 per cent from 13.7 per cent even as overall sales dipped three per cent to 198 units.

DT Dobie, which sells Mercedes, and CMC, the Land Rover dealer, are the other major players in the luxury saloon car market whose sales dropped from 110 and 62 units in 2010 to 109 and 42 units last year respectively.

Rivalry in the commercial vehicle market is also set to intensify after Toyota’s announcement that it is re-introducing the Hino bus and truck brands by early next year.

“My immediate focus will be to bring to fruition some of the planned activities including opening of more branches/dealerships and the foray into the (Hino) truck and bus segment” said Naoki Takeuchi, Toyota’s new managing director.

Assembled locally

Toyota has relied heavily on saloon car and pick-up sales, lacking a presence in the commercial vehicle market dominated by GMEA, Simba Colt, and CMC.

The Hino brands will be imported from Hino Motors – a subsidiary of Toyota Motor Corporation—and will be assembled locally.

Hino bus and trucks are popular in Japan but have been absent in the local market after various dealers, including Toyota, terminated the franchise years back.

Their re-introduction is set to up competition in the commercial vehicle market after the entry of low-cost Chinese manufacturer Foton East Africa that has set up an assembly plant in Nairobi producing pick-ups, trucks, and buses.

CMC’s introduction of a new Ford Ranger pick-up is also expected to raise the stakes in the pick-up segment –the fastest growing market dominated by GMEA and Toyota.

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