The prices of imported used cars have increased by an average 37 percent amid what local dealers say is a slump in global supply.
According to the dealers, car owners in developed countries have been reluctant to get rid of their cars due to the economic hardships as a result of the Covid-19 pandemic, reducing the supply of used cars in the country.
The dealers further blame a scaled-down production of new cars by European and Japanese carmakers due to a reported global shortage of semiconductors and computer chips used in car production.
This, according to the merchants, has in turn increased competition for used cars from buyers in the countries as they are now purchasing second-hand vehicles as a result of the shortages.
“The cost of the dollar locally is also a factor. Last year the dollar was retailing between Sh105 and Sh110. Currently, it is at Sh115 and above, depending on the source,” said Charles Munyori, the secretary-general of Kenya Auto Bazaar Association.
As a result, the price of a Toyota Vitz, which traded at around Sh600,000 last year has increased 44 percent to Sh1.07 million with its Nissan counterpart, the Note, up to around Sh938, 000.
Dealers are now placing the Toyota Harrier at Sh3.64 million, up from Sh2.22million while the Nissan X-Trail has jumped by over half to Sh2.84 million.
Meanwhile, the price of a Toyota Premio has increased from Sh1.2 million to Sh1.6 million.
The merchants have further warned that the car prices are not likely to fall this year as is usually the case from April to December.
“Prices have gone haywire since the start of quarter four last year and are unlikely to come down and will defy the January-March cycle,” said Munyori.
He added: “The market will stabilize once there is a sharp rise in new cars in Asia and western countries. This will take time.”
