Sales of new luxury cars rose seven percent in the year ended December, defying the economic slowdown brought by the Covid-19 pandemic.
Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers including DT Dobie moved 152 units in the review period compared to 142 units the year before. The performance is contrast to the overall new vehicles that recorded a 16 percent sales slump to 13,199 units in the same period on what has been attributed to the pandemic-induced economic crisis.
Rich households and some private companies, however, increased their purchase of luxury cars at a time when most businesses and workers suffered major income declines from measures taken to curb the spread of coronavirus.
The trend demonstrates that high-net-worth individuals and profitable companies have significant cash buffers and can maintain or raise their spending even during general economic turmoil.
Prices of most new luxury cars range from Sh6 million to Sh20 million, with a few models topping the Sh30 million mark.
BMW, sold by Inchcape Kenya, was the best performing brand with its unit sales rising to 24 from 17.
Mercedes, sold by DT Dobie, was second with sales improving to 59 from 47. Some high-end car brands suffered reduced demand but this was not enough to pull down the performance of the overall luxury car segment.
Sales of Bentley, by Bentley Nairobi, dropped to two from three while those of Jaguar (by Inchcape Kenya) fell to six from seven.
Orders for Porsche declined to 25 from 27. Porsche Centre Nairobi, the Kenyan dealer which has been selling the high-performance German sports cars, has had its contract terminated effective the end of this month.
Sources familiar with the matter told Business Daily that Porsche Centre Nairobi will continue to offer parts and service to clients until March.
The reason for the termination of the dealership agreement was not immediately clear but sales of the luxury sports cars have dwindled in recent years. The franchise owner, Stuttgart-based Porsche AG, is expected to transfer the dealership to a new entrant or one of the existing dealerships in the local market.
The dealership was well received when it opened in May 2014, with sales rallying to 125 units within the first eight months. Orders for the models, led by the popular sports utility vehicle (SUV) Cayenne, stood at 102 units in 2015 and dropped to 54 units the next year as the slump continued.