Commodities
Used car prices jump up to 33pc in months
Friday November 05 2021
Imported cars at a yard in Changamwe, Mombasa. PHOTO | KEVIN ODIT | NMG
Summary
- Popular 2014 Japanese models such as Toyota Harrier, Toyota Fielder, Toyota Rav 4, Toyota Premio and Nissan X-Trail have seen their yard prices increase by a range of between Sh200,000 and Sh600,000 since April.
- Car importers say purchase prices in Japan, the major source of used vehicles, increased by $4,000 (Sh446,400) on average.
- A Vanguard is going for Sh2.8 million, up from Sh2.5 million while the price of a Premio has increased to Sh1.9 million from Sh1.6 million.
Used car prices in Kenya have risen by up to 33 percent over the past six months as demand outstrips supply globally on production cuts.
Popular 2014 Japanese models such as Toyota Harrier, Toyota Fielder, Toyota Rav 4, Toyota Premio and Nissan X-Trail have seen their yard prices increase by a range of between Sh200,000 and Sh600,000 since April.
Car dealers are now facing increased competition from buyers in source markets such as Japan and the UK as automakers have scaled-down production owing to shortages of semiconductors that are used in electronic devices.
Most of those buyers in the developed markets would typically buy new cars but have now resorted to purchasing second-hand models in response to shortages and escalating sticker prices of new vehicles.
Economic uncertainty brought by the Covid-19 pandemic has also seen consumers in the developed world keep their cars for longer than usual, further reducing supplies to Kenya, which relies on imported used models.
“The prices of some cars have shot up by almost Sh500,000,” said Charles Munyori, the secretary-general of Kenya Auto Bazaar Association, which represents used car dealers.
“Most people, for instance, are not importing Rav-4 because they are very pricey to import now and hence stay at the yard longer. So this has created a shortage that has pushed the price from Sh2.3 million in April to Sh2.8 million.”