Sales of new cars drop as economy slows

Toyota has maintained its pole position as the top selling car even as declining sales hit local and overseas markets.

But as Toyota leads the pack, dealers expect sales of new cars to remain depressed in coming months as effects of global recession strike the local auto industry.

"The economic downturn is being felt, especially in the new vehicle segment, which are usually sourced from overseas using hard currency," Mr Simon Mwiti, National Sales Manager, Toyota East Africa told The Standard.

A weakening shilling has only worsened the situation for importers and dealers because they have to adjust prices upwards to safeguard margins.

Other segments hit by low sales include high-end sports utility vehicles as well as heavy commercial trucks, but light commercials are yet to feel the pinch.

Top selling makes

Statistics from Kenya Motor Industry (KMI) put Toyota ahead of the pack accounting for over 25 per cent of new car sales in January. The statistics show that 854 vehicles were sold in January, increasing marginally to 876 units in February this year.

Some 218 Toyotas (25.5 per cent of all sales) were sold in January, dropping to 212 units (24.2 per cent) in February this year.

This was followed by Isuzu, which sold 135 units (15.8 per cent) in January but rose to 175 units (20 per cent) in February.

On the list of top selling makes in February after Toyota and Isuzu were Nissan, Mitsubishi, Peugeot and Alpha Romeo.

Between January and February, Nissan sales rose from 103 units to 110, Isuzu (135 units to 175), Mitsubishi (146 units to 174), Chevrolet (two units to four ) and Tata (22 units to 25), while all other makes had a drop in sales from 226 units in January to 176 units in February this year.

KMI statistics show that between January and February, one tonne vehicles lead with 346 units, 4WD estate with 263 units, light trucks (3.5 tonnes to 9 tonnes) selling 226 units and double cabs moving 191 units.

The slowest moving classes were big trucks, large station wagons and saloons with engine capacity of more than 1800cc.

Trend could worsen

While local franchise holders are beginning to record a slow down in sales, this trend could worsen as leading car makers reduce production, scale back investment and cut jobs in an effort to remain afloat in the backdrop of the global financial crisis.

The US GM has lost the top slot to Toyota for the first time in 77 years. It fell behind Toyota selling 8.35 million vehicles globally last year compared to the Japanese giant’s 8.97 million units.