Vehicle sales drop 5% in 7 months as Zimbabwe economic woes bite

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Sales of new motor vehicles dropped by 5% to 2 089 in the first seven months ending July from the same period last year, an illustration of how depressed the market is.new-slider
During the same period last year, sales totalled 2 202 vehicles.

 

Car brands that registered growth were Datsun and Volkswagen — growing by 708,1% and 195,1% respectively.

In the period under review, Volkswagen sold 28 vehicles, while Datsun sold 46 from a previous of 10 and six cars recorded from last year respectively.

Motor Industry Association of Zimbabwe president, Luckson Gwara, said the drop was due to prospective buyers having no cash and the importation of cheaper ex-Japanese vehicles.
“The trend is a downward spiral, where we basically have a scenario of people not having enough money to buy so, it (retail car sales) is really going down and is slow. I guess it is all driven by the economy. If it improves, maybe we might see better things happening. It (ex-Japanese vehicles sales) has always been rising, but I think it is going to slow down because of the controls in terms of payments abroad,” he said.

“It (ex-Japanese vehicles sales) is no longer a priority, so if there is any rise in those vehicles, it will be those in the Diaspora, where people there buy vehicles for their relatives back home. I think transactions from Zimbabwe to get ex-Japanese vehicles will happen, but I think they will also slow down with time.”

Analysts say other factors for the decreased sales stem from lack of credit facilities to buy cars due to lower disposable income.

In terms of market share, Nissan remained tops, having sold

446 units, though it was down 6,9% from 505 over the same period last year.

Toyota came in second with 396 units sold under the period and experienced a drop of 0,3%, despite Toyota Zimbabwe having had to recall 85 vehicles from the market last year due to some glitches.

Isuzu had a drop of 2,5% to 140 vehicles sold during the period under review from 144 recorded last year.

Luxury cars experienced a steep drop, as the market now favours smaller and more affordable vehicles. Brands such as Mercedes Benz, Jaguar, Land Rover and Jeep dropped 4,6%, 36,8%, 62,1%, and 51,5%, respectively.

Sales of pre-owned vehicles have not shown any sign of slowing down despite surtax on second-hand passenger vehicles being increased to 35% from 25% in September 2015 to encourage local sales.

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