Local demand for luxury cars drops since turn of year

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By Edna Mwende

The New Year brought with it a decrease in the purchase of luxury cars in the local scene with top brands such as Porsche and BMW not registering the sale of even a single car since the turn of the year.

In a news report by the Business Daily, data released by the Kenya Motor Industry Association (KMIA) shows that the sales of Land Rover and Range Rover also dropped from 14 to 8 in the first two months this year with Jaguar, Land rover and BMW only selling one car in the period under review.

“For the first two months, we’ve never reported any sales but we are expecting vehicles this month in the country this month. We have sales but we cannot report before we hand over the car to the customer,” Inchcape Kenya marketing manager Charity Mutunga is quoted as saying in a phone interview with Business Daily.

Other cars that saw a drop in sales were the Jeep Grand SUV; which sold only one car, Toyota, whose units fell from 588 to 403, Mitsubishi which only sold 292 vehicles down from 306 in the last two months of 2018 and Nissan which sold 49 cars down from 108 in November and December last year.

Among the luxury car brands on offer in the market only German brand Mercedes was able to register an increased sale of its units with the automaker increasing its sales from 32 cars to 48 cars in the period under review.

Luxury cars dealers have seen a slow growth in sales in the last few years and this, according to KMIA, is as a result of the government’s increased scrutiny on individuals’ lifestyles in the ongoing war against corruption and tax evasion.

The slump in the sale of luxury vehicles could be as a result of the government introducing the lending rate cap in September 2016. This consequently reduced the flow of bank loans which in turn stifled the credit market with banks becoming more cautious in their lending practices.

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