Sales of new vehicles declined 12.5 percent in the half-year ended June as the major dealers posted a mixed performance in the review period.
Orders in the industry fell to 5,679 units compared to 6,492 units a year earlier according to data from the Kenya Motor Industry Association (KMIA).
Most of the dealers including Isuzu East Africa and Simba Corp registered lower sales in the review period. CFAO Motors Kenya, newly merged from the former Toyota Kenya and DT Dobie, bucked the trend to post higher sales.
Players in the industry faced multiple challenges in the review period including shortages of some models, rising interest rates for customers financed by banks and pending bills which are progressively being settled by the government.
The debate which surrounded the Finance Bill 2023, which has since been signed into law, also caused a wait-and-see stance among some customers fretting over the expansion of taxes.
“We are now cautiously optimistic about sales growth in the second half of the year. We see improvement in the agricultural sector and people are also adjusting to the new Finance Act,” a source said.
CMC Motors, which earlier announced it was exiting the motor vehicle business to focus on agricultural equipment, saw its sales plunge to 18 in the review period as it moved to clear its stocks.
It had sold 306 vehicles a year earlier, with the change in its business model cutting its market share from 4.7 percent to 0.3 percent.
CMC was scheduled to relinquish the Ford dealership to Salvador Caetano in this quarter while the Suzuki franchise moved to CFAO. CMC’s Mazda dealership is yet to find a new home.
Ford was the most important franchise for CMC in the passenger vehicle business, having accounted for 78.7 percent of its total vehicle sales last year.
Orders at Isuzu dropped to 2,503 in the half-year period under review compared to 2,867 a year earlier. The dealer’s market share was however unchanged at 44.1 percent, joining other firms that benefitted from CMC’s business overhaul.
Isuzu sells its namesake brand of pick-ups, buses, trucks and sport utility vehicles (SUVs).
Simba Corp’s sales declined to 581 from 681 but its market share shrunk marginally to 10.2 percent from 10.5 percent. The dealer holds multiple franchises including Mitsubishi and Proton.
CFAO bucked the trend, growing its sales 9.7 percent to 1,906 in a move that raised its market share from 26.8 percent to 33.5 percent.
CFAO now sells multiple brands under one roof after the merger of the former DT Dobie and Toyota Kenya. The franchises include Mercedes, Volkswagen and Hino.
The merger followed the buyout of DT Dobie by Toyota Kenya’s intermediate parent firm CFAO Group.
