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New vehicle sales rise by 14pc in August

By Steve Umidha
Thursday, September 17th, 2020
Motor vehicle showroom. Photo/Courtesy
In summary
    • Improved consumer sentiment buoyed by improving economy and gradual return of normalcy for most businesses are key indicators of better days ahead for car manufacturers.
    • The manufacturers have sold a total of 5,532 vehicles since the start of the year as compared to 7,444 units they sold by the same time last year.

Steve Umidha @SteveUmidha

New vehicle sales increased for the second time this year as dealers benefitted from easing of coronavirus (Covid-19) lockdown measures, new industry data shows.

Statistics from Kenya Motor Industry Association (KMI), representative body of the formal motor sector shows that a total of 1,044 vehicles were sold in August compared to 910 units sold in July – representing a 14 per cent jump.

Car dealers sold 756 new vehicles in June bringing  to 6,502 the number of new vehicles sold since the start of the year.

Welcome relief

Market players said the reopening has provided some welcome relief for the industry, and the August figures also suggest that dealers in used cars could record an improvement next month. 

This is after most dealers in that segment were forced to cut prices by up to 15 per cent this month in response to depressed demand because of the Covid-19 pandemic.

However, the pace of decline has been evident for most car dealers in the last five months owing to effects of the pandemic even though sentiments from industry observers predict better months ahead because of lifting of lockdowns and certain restrictions by the government.

“August sales is an indicator of how the industry will play out in the months ahead with most dealers presently reviewing their marketing budgets as the economy gradually opens and the curve seen to be flattening,” commented Stephen Mbuthi – an auto expert.

Reported figures

The August sales are, however, lower compared to 1,372 units sold in the same period last year – with the reported figures providing some perspective on the industry, whose numbers according to KMI Chairperson Rita Kavashe, are expected to weaken by about 30 per cent this year.

The industry had shown an early steady peak in February before the pandemic hit in, a period that saw 1,049 units sold – the best in a single month the sector has seen since the start of 2020 and better than 857 the industry sold in a similar period last year.

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