Kenya: New Car Sales Recover After Covid-19 Curbs Easing

29 September 2020

Sales of new motor vehicles have started recovering from the economic fallout of the Covid-19 pandemic following the reopening of the economy starting July.

Travel restrictions and the panic induced by the disease saw orders plummet to a low of 568 units in May.

Sales have, however, risen steadily to reach 1,044 units in August and nearly matched the peak of 1,049 units in February.

Data from the Kenya Motor Industry Association (KMI) shows that orders in the eight months ended August are still down 26.3 percent but the downward trend has been reversed.

Dealers including Isuzu East Africa, Toyota Kenya and Simba Corporation sold a total of 6,580 units in the review period compared to 8,940 units a year earlier.

"Reopening of the economy is a major factor for the rebound in sales," said Rita Kavashe, the chief executive of Isuzu East Africa.

Resumed financing

On a monthly basis, May saw the biggest sales contraction of 54.4 percent but the decline rate has been slashed to 23.9 percent in August.

The government had imposed restrictions on domestic and international travel besides shutting schools and bars to control the pandemic which was first reported in the country on March 12.

Most of those measures have been removed starting July, with the number of infections and deaths from the disease steadily declining.

Ms Kavashe said that demand from transport operators and schools fell the most during the lockdown period while sales of heavy commercial vehicles like tippers remained strong.

She noted that banks had severely cut back lending on the outbreak of the disease but have since resumed financing of vehicle purchases.

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