Hard times as new luxury vehicle sales decline by 15 percent
Sales of new luxury cars fell 15.4 percent in the year ended December 2022, registering a bigger slump compared to the overall new vehicle market.
The formal dealers –Inchcape Kenya and DT Dobie— sold a total of 104 units in the review period according to data from the Kenya Motor Vehicle Industry Association (KMI).
This was down from the 123 units they sold a year earlier. Sales in the entire new vehicle market meanwhile declined by a smaller margin of 6.3 percent to 5,968 units.
BMW sales, which marked the biggest contraction, were responsible for most of the decline in total luxury car orders. Inchcape Kenya sold 24 of the German cars in the review period, down from 36 the year before.
Mercedes sales followed, dropping to 41 from 45. Mercedes cars are sold by DT Dobie. Jaguar sales, by Inchcape Kenya, halved to two from four.
Sales across the Land Rover franchise remained unchanged at 37. The Land Rover models –including Range Rover and Discovery— are also sold by Inchcape Kenya whose market share in the luxury segment dropped to 60.5 percent from 62.6 percent.
The market share of DT Dobie –which used to be the market leader— on the other hand increased to 39.4 percent from 36.5 percent.
There were no Porsche sales last year, with one unit having been sold in 2021.
The German car brand has been out of stock after the contract of the former franchise holder –Porsche Centre Nairobi— was terminated in January 2021.
The owner of the brand, Stuttgart-based Porsche AG, has appointed a new dealer for the local market and the formal announcement is expected to be made in the next few weeks.
Sales of Porsche opened strongly at 125 units in 2014 but tapered off to hit the nadir of 25 units in 2020 as the pent-up demand for high-performance cars waned.
The decline in luxury car sales signals reduced spending among private companies and wealthy individuals, with the government also trying to slow down its expenditure.
New luxury cars are mostly bought by private firms, government departments like the judiciary as well as wealthy individuals.
Prices of high-end cars can top the Sh30 million mark depending on the brand and specifications.
Some of the premium models sold by the dealers last year include the Mercedes S Class, Range Rover Vogue and BMW 7 Series.
British car brand Grenadier is set to start retailing in the local market, offering a more rugged brand of luxury.
The car, which resembles the classic Land Rover Defender, has $122,000 (Sh15.2 million) as its indicative price inclusive of all taxes according to the local dealer Wootton Automotive. BY DAILY NATION
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