Sales of new motor vehicles rose 11.7 per cent in the first quarter ended March, attributed to the growing economy.
Data from the Kenya Motor Industry Association (KMI) shows that the formal dealers including Isuzu East Africa, Toyota Kenya and Simba Corporation sold 3,203 units in the review period, up from 2,867 units a year earlier.
The performance marks continued recovery in the motor vehicles industry, which suffered reduced sales in 2020 due to the impact of the Covid-19 pandemic, including restriction of movement, business disruption and reduced incomes for firms and households.
Economic growth contracted 0.3 per cent in 2020 but recovered to post a 7.6 per cent growth last year after the restrictions were removed in response to the receding pandemic.
Toyota dealer CFAO Motors Kenya had the highest sales growth among the major dealers in the first quarter ended March with the sales increasing to 770 a 26.6% jump from 608 recorded in 2021.
However, CFAO Motors announced that its 2022 full-year sales could drop by some 700 units due to a semiconductor chip shortage that is hurting the supply of vehicles to customers.
“It [sales] is coming down because currently, we have a few challenges all over such as getting the chips. At this point in time, we cannot meet our demand. We have more demand than supply and we hope that we can catch up with production in the next few months.” Mr Arvinder Reel, CFAO’s managing director.
Other motor vehicle dealers including DT Dobie had also warned of a potential sales decline due to the chip crisis which is expected to continue into 2023.
Some automakers have resorted to doing away with high-tech systems like park assist and touchscreens as the shortage bites. Semiconductors are used in electronic devices and are critical components in modern cars.
