TIFA in conjunction with Cheki Kenya have launched the Kenya Used Vehicle (KUV) Price Index, focusing on the price variation of car listings in the Kenyan market.
The Index report compares prices and price trends for different months, quarters or years, enabling users of the index to calculate the rate of inflation in the car market.
Speaking during the launch of the report, TIFA’s CEO Maggie Ireri said “The KUV Price Index growth sustained a downward trend from an index of 102.81 in February compared to an index of 67.87 in March based on a fixed base Index. This decline is attributed to the adverse effects of COVID-19. The price index increased in August to 149.25. I foresee this index being used by car dealers, car buyers, financial and economic analysts as an indicator of pricing trends in the used vehicle market.”
Qualitative research data showed that dealers in used cars reduced prices between February and March in response to a grim demand in an economy reeling from the effects of the COVID-19 pandemic which was majorly caused by the loss of incomes and inability of many households being unable to service bank loans.
In her observation, Resian Leteipan, Cheki Kenya CEO noted that “sale of cars seized by banks could have potentially increased supply in the market, further putting downward pressure on prices.
“Used car imports in Kenya have been on steady rise since the rise of infections in the country from early this year as many individuals opt for private means of travel in a bid to reduce the chances of being infected with the COVID 19 virus.”Resian Leteipan, Cheki Kenya CEO
Imported second-hand vehicles account for 85 percent of car purchases in Kenya. This has mainly been pivoted by the high internet penetration rate in the country with many Kenyans having access to both local and foreign car importation websites that present a variety of options to choose from.
The data analyzed also showed large declines were recorded for pick-ups, 4-wheel drives and SUVs, saloons, hatchbacks, buses, vans and mini vehicles. The prices increased between April and May 2020, with the station wagons, coupes, and 4-wheel-drives/SUVs registering the highest variation.
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