Companies

New luxury car sales drop 31pc

BenzAClass

DT Dobie general manager, Mercedes Benz Maliha Sheikh (left) and marketing manager Caroline Wamai when the firm unveiled the Mercedes Benz A Class sedan in October 2020 in Nairobi. FILE PHOTO | NMG

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Summary

  • Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers, including DT Dobie and Inchcape Kenya, sold 29 units in the review period, down from 42 a year earlier.
  • The luxury car segment underperformed the overall new vehicle market by large margins, indicating reduced spending by firms and wealthy individuals.
  • Total industry sales rose 6.26 per cent to 2,867 units during the same period, driven by increased demand for trucks.

New luxury car sales plunged 30.9 percent in the first quarter ended March on reduced demand for all the high-end brands with the exception of Mercedes Benz.

Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers, including DT Dobie and Inchcape Kenya, sold 29 units in the review period, down from 42 a year earlier.

The luxury car segment underperformed the overall new vehicle market by large margins, indicating reduced spending by firms and wealthy individuals.

Total industry sales rose 6.26 per cent to 2,867 units during the same period, driven by increased demand for trucks.

Unit sales of Land Rover, sold by Inchcape Kenya, declined the most among the high-end car dealers to two in the review period from nine a year earlier.

Porsche, sold by Porsche Centre Nairobi, was second as its orders fell to one from seven.

The dealer is clearing its stocks of the German high-performance car brand after its contract was terminated by the manufacturer.

The company’s franchise was terminated effective January and it was allowed to continue offering parts and service until March.

The manufacturer, Stuttgart-based Porsche AG, is yet to announce its new partner in Kenya. Franchise transfers have the effect of hurting a brand’s sales as the old partner stops importation and the new dealer takes time to set up operations.

A few dealers, including Simba Corporation, have been in the race to take up the Porsche dealership in Kenya.

Simba, which lost the BMW franchise to Inchcape Kenya, has been absent in the high-end car market for more than two years.

Inchcape’s sales of BMW dropped to seven from eight while Bentley sales, by Bentley Nairobi, were unchanged at one.

There were no sales of Jaguar, also under the Inchcape stable, in the first quarter of 2020 and this year.

Mercedes Benz was the only luxury car brand to buck the trend, with its sales rising to 18 from 17. This has given the brand, whose franchise is held by DT Dobie, a 62 per cent market share in the high-end car segment.

This marks a resurgence for DT Dobie which had been supplanted as the top luxury car dealer in the past few years from pent-up demand for new models such as Porsche.

Mercedes has been popular among wealthy individuals and government departments such as the Judiciary.

DT Dobie’s expansion of its Mercedes SUV line-up has also boosted sales from customers seeking to combine luxury and ruggedness to tackle rough roads.