While the government emphasizes that these measures are essential to ensure fair distribution of privileges and prevent exploitation, some experts believe that delays in implementing these amendments have harmed citizens and created confusion in the market.
Stricter measures to ensure fair privileges
The new amendments to the law governing the import of vehicles for individuals with disabilities are designed to rectify previously lax conditions that allowed the exploitation of privileges by ineligible individuals, Automotive Manufacturers Association Secretary-General Khaled Saad told Ahram Online.
He explained that the old law permitted importing vehicles with engine capacities up to 1600 cc, registered in the name of the individual with disabilities or their caregiver, without requiring payment through specified financial channels.
However, the new law imposes stricter regulations, including reducing the engine capacity to 1200 cc and requiring the beneficiary to transfer the vehicle's value.
Additionally, those receiving government support, such as Takaful and Karama, are prohibited from importing vehicles, and the driver must be the beneficiary or a close relative.
Saad also noted that these amendments have halted the import of new vehicles for people with disabilities and imposed restrictions on existing vehicles in free zones. Vehicles can only be released if registered in the original owner's name and paid for through the beneficiary's personal account.
Delays in procedures and harm to citizens
Alaa Al-Saba, a member of the Automotive Division at the Federation of Egyptian Chambers of Commerce, expressed concern about the timing of these amendments. He said the delay in issuing them has harmed many citizens waiting to receive their vehicles under the old law.
Al-Saba told Ahram Online that the delay in resolving these procedures has caused many citizens to struggle, and some have even faced injustice due to the ambiguity surrounding the old and new laws.
Moreover, he noted that some traders exploited these loopholes to import vehicles and sell them outside free zones at lower prices, ranging from $3,000 to $4,000.
Under the new system, buyers must pay up to EGP 100,000 or more to complete registration procedures.
He also clarified that beneficiaries of the Takaful and Karama programmes were stripped of privileges despite some having saved money for years to purchase a vehicle to assist with mobility.
Therefore, Al-Saba emphasized that these decisions must be reviewed to avoid affecting genuine beneficiaries' support.
Combating exploitation
Saad confirmed that the government had taken decisive steps to prevent the exploitation of privileges related to individuals with disabilities or personal imports. Some individuals were importing vehicles through these channels to evade restrictions on commercial vehicles, subsequently modifying their status for financial penalties.
"With the new directives, these loopholes have been completely eliminated, and importing is now conditional on precise procedures to ensure fair use," Saad stated.
He further clarified that the new directives also aim to enhance local manufacturing. These policies are expected to transform Egyptian industry by reducing reliance on imports and directing investments toward local production.
Impact of global economic changes
Al-Saba also addressed the global influences on the automotive market, noting that economic changes, including trade wars between the United States and China, cast shadows over global trade and affect supply chains and prices.
"Delays in certain customs decisions negatively impact international trade, and any escalation in trade disputes leads to losses for all parties involved. Although Egypt is not at the centre of these disputes, the indirect effects could reach the local market,” he explained.
Key factors in setting prices
Saad affirmed that the dollar rate in the local market remains the most influential factor in vehicle prices in Egypt. This rate is linked to import costs and customs duties.
Over the past two years, Egypt has applied four waves of fair pricing to the local currency against other hard currencies.
For instance, the Egyptian pound is now set at over EGP 50/$1, compared to EGP 15/$1 in March 2022, before the outbreak of the Russian-Ukrainian war.
Saad said that, due to production and import cycles, any increase in the exchange rate takes about three to four months to reflect in vehicle prices. However, this impact may be less noticeable under current import restrictions.
He noted that 90 percent of companies in Egypt have begun to rethink their strategies, focusing on local manufacturing instead of relying on imports, a trend supported by the government to reduce pressure on foreign currency and enhance local production.
Outlook on the automotive market
Saad and Al-Saba agreed that the Egyptian market is currently experiencing relative stability. They expect this stability to continue as the focus shifts toward local manufacturing and increased supply.
Saad stated that economic vehicles had become the most sought-after option in the market. They are projected to capture 70 percent of the market share, with stable prices ranging between EGP 600,000 and EGP 800,000.
"The Egyptian market is undergoing sharp fluctuations due to regulatory and economic changes; however, there are some indicators suggesting relative price stability in the coming months," he explained.
"Challenges remain, but the solutions proposed by both the government and companies are aimed at building a strong and sustainable local automotive industry," Saad added.
Meanwhile, Al-Saba pointed out that the market currently offers buyers good opportunities and that current prices are fair compared to previous periods.
He expressed hope for continued stability without sudden increases due to fluctuations in the exchange rate or customs decisions.
"Despite cautious optimism regarding sustained stability, we hope no disruptions will lead to a new wave of price increases," Al-Saba concluded.
Short link: