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September 23, 2017

GM East Africa retains lead as car sales decline

General Motors Motor Vehicles assembly plant head office situated  along Nairobi-Mombasa road./FILE
General Motors Motor Vehicles assembly plant head office situated along Nairobi-Mombasa road./FILE

General Motors East Africa remained the top motor vehicle dealer in the first four months of the year with a share of 36.3 per cent of the 3,635 new units sold in the period, industry data shows.

The American-owned auto company is in the final stage of exit from the East African market after it sold its entire 57.7 per cent stake in General Motors East Africa to Japan’s Isuzu Motors. GMEA is imminently set to rebrand to Isuzu Motors East Africa. Isuzu brand, largely commercial buses and trucks, drives 95 per cent of the GMEA’s sales on average.

Cumulative data for the four months to April collated by the Kenya Motor Industry Association shows that Toyota was second largest dealer with 23.1 per cent of the market share. It was followed followed by Simba Colt, another dealer in commercial vehicles, with 16 per cent market share.

During the period, CMC controlled the fourth largest share of sales at 7.7 per cent, followed by Crown Motors ( 3.9 per cent), DT Dobie ( 3.7 per cent ) and Tata Holdings ( 3.3 per cent) market share.

The industry data shows total new vehicles sold in the four months was 3,635 units, with an annual industry projection of 13,500 units – which is flat compared to 13,869 units in 2016.

Light trucks, account for majority of new vehicle sales, declined by 26.5 per cent to 1,032 units from 1,404 units in 2016.

GMEA accounted for 53.2 per cent of light trucks sold during the period with 549 units. This was, however, a 20.09 per cent decline year-on-year from 687 units the auto dealer sold during the same period in 2016.

The market has continued to suffer from the interest rate cap which has squeezed credit access in the private sector as banks opt to invest in government securities.

“Banks have gone slow on lending due to the interest rate cap, this has not just affected us but the whole sector,” GMEA communications manager Dancan Muhindi said.

He said the firm expected a slowdown in the coming months due to August 8 polls citing that clients were deferring purchases to the fourth quarter of this year or the beginning of next year.

“Most of our customers are adopting a wait and see attitude, choosing to make their purchases once the elections are over,” Muhindi said.

Sport Utility Vehicles were the second largest items sold at 671 units, 3.5 per cent up from 648 units sold during the same period last year.

GMEA accounted for 9.5 per cent of SUVs sold during the period with 64 units, a 72.97 per cent from 37 units sold in the first four months of 2016.

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