NAIROBI, KENYA: The demand for high-end used cars in the country is on the rise going by a new study released on Wednesday.
Research firm Tifa and car listing firm Cheki in a joint survey indicates the majority of buyers prefer used 4 Wheel drives and SUVs compared to other body types.
“The 4-wheel drives and SUV dominate the listed used vehicle market,” indicates the study dubbed Kenya Used Vehicle (KUV) Price Index.
“The supply of 4-wheel drives and SUVs could be driven by the high demand for luxury cars by affluent consumers and profitable firms whose spending is not affected by the economic turmoil arising from COVID-19.”
Toyota is the most listed vehicle in the market compared to other vehicle models. Nissan and Subaru’s are a distant second and third. The top five least listed car models are Audi Lexus, Land Rover, Isuzu, and Ford.
The Kenya Used Vehicle (KUV) Price Index report focuses on the prices of car listings in the Kenya market. The purpose of the Kenya Used Car Index is to measure the average price change over time. By comparing prices and price trends for different months, quarters, or years, users of this Price Index will be able to calculate the rate of inflation.
If you wanted to own a used car to make your movement much better, probably the month of February and March would have been the right time to make an order, according to the survey.
During the period, dealers in used cars were forced to cut prices in response to depressed demand in an economy reeling from the effects of the COVID-19 pandemic. The sale of cars seized by banks could have increased supply in the market, further putting downward pressure on prices.
“It should also be noted that many Kenyans lost their source income and were not able to service bank loans,” says a study dubbed Kenya Used Vehicle (KUV) Price Index by Tifa and online Car listing Company Cheki
The prices increased between July and August following phased re-opening of the country from a coronavirus-induced lockdown, lifting restrictions in and out of the capital Nairobi and the coastal city of Mombasa.
According to the study, the KUV Price Index growth sustained a downward trend from an index of 102.81 in February compared to an index of 67.87 in March based on the fixed base Index. The price index stood at 110.09 in April with a growth of 42.22 from March.
“The Price Index maintained a slight change in July which stood at 120.54. A price increase was observed between July and August with a growth of 29.11 and stood at 149.25. A price decrease was observed between August and September from a price index of 149.25 to 136.42.”
In addition to a downward trend in prices, there was also a downward trend in the number of listings of vehicles during March 2020. This is also attributed to the effects of the COVID-19 pandemic.
There was a decline in the prices of all vehicles between February and March 2020. Significantly large declines were recorded for pick-ups, 4-wheel drives and SUVs, saloons, hatchbacks, buses, vans, and mini vehicles.
The prices increased between April and May 2020, with the station wagons, coupes, and 4-wheel-drives/SUVs registering the highest variation.
Imported second-hand vehicles account for 85 per cent of Kenyan car purchases. A used car is a vehicle that has previously had one or more retail owners. The growth of the internet has fueled the availability of information on the prices of used cars.