Companies

Sales of new luxury car dealers fall 22pc

Benz-dobie

New luxury car dealers saw their sales fall 22.2 percent in the nine months that ended September, with demand for BMW and Mercedes models declining the most. PHOTO | NMG

New luxury car dealers saw their sales fall 22.2 percent in the nine months that ended September, with demand for BMW and Mercedes models declining the most.

The dealers led by DT Dobie and Inchcape Kenya moved 84 units in the review period compared to 108 units a year earlier, according to data from the Kenya Motor Industry Association.

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The luxury segment had a worse performance than the overall new vehicle market which reported a marginal sales decline of 1.75 percent to 9,868 units in the same period.

The contrasting performance continues the long-running trend where commercial vehicle dealers are dominating, aided by strong demand from the government and businesses besides the policy of restricting imports of used trucks.

Sales of Mercedes shrunk to 33 from 43 but the German car models remained the top selling brand in the country. Mercedes cars are sold by DT Dobie. Orders for BMW followed, declining to 21 from 30. Inchcape Kenya started selling BMW cars in early 2019 after taking over the franchise from Simba Corp.

Sales of Jaguar cars dropped to one from four. Orders for Land Rover models – including Ranger Rover— were unchanged at 29. There were no sales of Porsche and Bentley models in the review period, having recorded demand of a single unit each a year earlier.

Porsche is set to get a new dealer in the local market after the contract of Porsche Centre Nairobi — part of the Multiple Hauliers group of companies— was terminated by German automaker Porsche AG in January 2021.

Bentley Nairobi, also affiliated to Multiple Hauliers, is no longer listed as a dealer by Bentley Motors.

Franchise transfers typically hurt sales in the short term as the terminated dealer focuses on clearing stocks and the new appointee takes time to set up shop.

Besides lackluster demand, sales of high-end cars are also being held back by production hiccups owing to shortages of semiconductors which are critical in the functioning of modern vehicles.

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Automakers say they are prioritising the manufacture and marketing of high-margin models as they work to secure reliable sources of semiconductors.

“Wholesale volumes were 75,307 units in the period (excluding our China Joint Venture), up four percent compared to the previous quarter ending 30 June 2022,”

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