Formal dealers’ 2021 car sales rise to six-year high

toyota (1)

Toyota Kenya showroom. FILE PHOTO | NMG

New motor vehicle dealers sold 14,250 units last year, marking a six-year high as the industry recovered from the depths plumbed in 2020 as a result of the fallout from the Covid-19 pandemic.

The orders rose 29.8 percent from 10,977 units sold in 2020, according to data from the Kenya Motor Vehicle Industry Association (KMI).

The formal dealers including Isuzu East Africa, Toyota Kenya, DT Dobie and Simba Corporation benefitted from then removal of restrictions aimed at curbing the spread of the pandemic.

The end of travel bans and closures of schools, among other measures, has revived consumer and capital spending, reviving economic activities.

Isuzu recorded a 29.2 percent sales growth in the review period to 5,609 units, representing a 32.7 percent market share.

Isuzu exclusively sells its namesake commercial vehicles comprising pick-ups, buses, trucks and SUVs (sport utility vehicles).

Toyota’s sales increased 46 percent to 3,748 units, giving it a 21.9 percent market share. The dealer sells its namesake and Hino passenger cars, pick-ups and trucks.

Dealers assembling their vehicles locally such as Isuzu, Toyota and Simba Corp have benefited the most from the sales rebound, with most of the orders being commercial vehicles such as buses, pick-ups and trucks.

The share of locally assembled vehicles rose to a record 70.6 percent of total sales in the year ended December 2021, moving 10,054 units compared to 4,195 units of fully-built imported vehicles.

The formal dealers continue to gain as the economy recovers from the shocks of the Covid-19 pandemic though a global shortage of semiconductors presents new risks of supply disruption and higher vehicle prices.

Global automakers including Toyota and Volkswagen are cutting their production in the wake of inadequate supply of semiconductors –a key component of vehicles’ electronic parts. The economic expansion seen from last year is expected to continue in the short term, lifting demand for vehicles and other goods.

“Economic recovery from the effects of the Covid-19 pandemic continued in the third quarter of 2021 as a result of the gradual easing of containment measures instituted to curb the spread of the disease,” KNBS said.

“Real GDP grew by 9.9 percent in the third quarter of 2021 compared to a contraction of 2.1 percent in the same quarter of 2020.”

KNBS said the performance was driven by significant rebounds in most economic activities that had contracted in the third quarter of 2020.