Tuesday, November 30, 2021
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HomeBusinessWhy used car prices have gone through the roof

Why used car prices have gone through the roof

In Summary

  • The prices of some cars have shot up by almost KSh500,000.
  • Prices of a Nissan X-Trail and Toyota Harrier have risen by about KSh600,000.

Are you planning on owning a car? Well, this might come as a heartbreaker to you: Used car prices in Kenya have significantly risen of late.

In the past six months, used car prices have risen by up to 33 percent, as demand outweighs supply globally.

According to Charles Munyori, Secretary-General,Kenya Auto Bazaar Association, car dealers in Kenya are facing increased competition from buyers in other markets owing to a global shortage in semi-conductors used in electronic devices fitted in cars.

This shortage has slowed down production of new cars. In turn, buyers in developed markets would usually buy new cars are either purchasing second-hand models or holding on to their old cars that are usually exported to grey markets like Kenya.

The net effect is competition for few models in the used car auctions in Japan, U.K and Singapore. Inevitably, prices have gone up.

“The prices of some cars have shot up by almost KSh500,000. Most people, for instance, are not importing Rav-4 (Toyota) 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 KSh2.3 million in April to KSh2.8 million,” Munyori is quoted by a local newspaper as saying.

X-Trail, Harrier prices shoot

The prices of Nissan X-Trail and Toyota Harrier have risen the most- by about KSh600,000 for each unit. The models are now retailing at about KSh2.4 million and KSh3.4 million respectively.

Owing to the spike in prices, a Vanguard that used to sell at KSh2.5 million is now going for KSh2.8 million. A Toyota Premio is now going for KSh1.9 million, up from KSh1.6 million.

According to Munyori, semi-conductor shortages is expected to extend to 2022, meaning that Kenyans may be forced to fork out more on cars.

December 31 deadline looming!

This comes even as commercial and individual used car importers are rushing to bring in 2014-manufactured cars ahead of the December 31, 2021 deadline.

Starting January 1, 2022, only cars first registered in 2015 will be allowed in the country, owing to the eight-year rule for secondhand imported cars.

Any vehicle older than eight years will not be allowed in the country. They will either be destroyed, or shipped back at owners cost.

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