File photo showing new cars in a parking lot in Cairo, Egypt. REUTERS
According to AMIC’s annual report, car sales in Egypt decreased by approximately 48 percent in 2023, reaching 69,175, down from 133,857 cars in 2022.
The broader impact is evident as bus sales also halved, reaching 8,461 buses, down from 17,344, representing a 51.2 percent decrease. Truck sales decreased by 62 percent to 12,723, down from 33,570.
In all, the sales of cars, buses, and trucks witnessed a significant decline, totalling 90,359 vehicles in 2023, down from 184,771 in 2022, or a 51.1 percent decline in sales.
In December 2023, however, sales increased by 31.74 percent compared to the same month in 2022, according to the report.
Nissan, Chery, and Chevrolet lead market sales
Nissan, Chery, and Chevrolet emerged as the leaders in automotive sales in 2023, accounting for 37.6 percent of the total sales. While Nissan and Chery slightly increased their market share in 2023, Chevrolet experienced a significant decline of 6.4 percent compared to 2022.
In terms of passenger car sales, Nissan and Chery dominated with a 19.7 percent share in 2023, while Suzuki and Toyota led the bus sales, accounting for a total of 43.9 percent.
Chevrolet stays unbeaten in the truck market, accounting for 69 percent of truck sales.
Economic challenges spark price surge
Since the global economic crisis triggered the Russian war on Ukraine in February 2022, the new and used car markets in Egypt have experienced significant fluctuations. Many cars that had been considered attainable for the middle class have become unaffordable.
In the event of the Egyptian pound continuing to lose value against the US dollar, car prices may face further hikes.
Reasons including limited supply of cars received by distributors and the devaluation of the Egyptian pound have been blamed for price hikes in the automative market.
Car-marketing expert Ahmed Al-Mazahi said inflation, increased freight costs, the depreciation of the pound against the dollar, and a shortage of supply have all contributed to the problem.
Amid a foreign currency crunch, Egypt has introduced an initiative allowing Egyptians living abroad and their families to have one personal-use vehicle shipped to the country without paying customs duties or taxes, including the value-added tax (VAT).
Instead, participants are required to deposit the value of customs in foreign currency, which is then returned in Egyptian pounds after five years.
Minister of Finance Mohamed Maait stated in January that he expects the ongoing zero-customs car import initiative, launched in November 2022, to generate $2 billion.
While Egypt houses many car assembly factories and facilities, it seeks to position itself as a key player in Africa's emerging vehicle markets. In 2022, the state unveiled its national strategy for localizing the automotive industry.
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