Toyota to profit from improving new car market

By jackson okoth

Kenya’s new car market is expected to shrink further this year as the global economic slowdown takes its toll on the industry.

But dealers are increasing their investments to take advantage of the upturn when it does happens.

" We intend to increase our footprint in the region and will be establishing a logistics, as well as spare parts and service facilities, in Northern and Western parts of Nairobi," said Hylton Bannon, Toyota East Africa’s new managing director.

Global economic crisis

Available figures indicate that while 13,000 new car units were sold last year, the figure is expected to drop to 10,500 this year. And while this decline is blamed on effects of the global economic slowdown, competition from the used cars market has also hurt the industry. It is estimated that for every new car sold, there are five others sold in the used-cars market.

Dealers expect imports of used cars to beginning shrinking, as conditions in the source market, especially Japan, become tight.

" While the used car market has had an impact on our business, we are relying on quality and services to win this game," said Bannon.

Toyota customers will access to finance leasing facilities, hire purchase, operating and full maintenance lease, through Tsusho Capital Kenya, a leasing company.

Tsusho Capital will be used to support small and medium sized enterprise (SMEs) with leasing and off balance sheet financing, to get them through the hard times.

Toyota East Africa has recorded a one per cent increase in market share, from 23 per cent last year, to 24 per cent this year, despite a shrinking new car market.

 

 

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