This archive report was first published on 22 October 2019.
Published on October 22, 2019, data from the Kenya Motor Industry (KMI) Association revealed a 43% drop in orders for luxury cars like Porsche, Range Rover, and Jaguar in the nine months leading up to September.
Unit sales of high-end brands fell to 112 in the review period, down from 198 the previous year. This decline was steeper than the 6.5% sales drop in the overall new vehicle market, which sold 10,081 units in the same period.
Car dealers attributed the reduced demand for luxury cars to a mix of factors, including franchise and supply chain disruptions, as well as increased scrutiny from agencies like the Kenya Revenue Authority (KRA).
"Tax authorities are interested in people buying luxury cars. The option of paying for cars using cash is also now closed," said a dealer who wished to remain anonymous.
The KRA has been targeting individuals who drive high-end vehicles but have little to show in terms of taxes remitted. Car registration details are being used to identify these individuals.
There have also been stockouts of several luxury car models due to global manufacturers' production decisions and changes in local franchise ownership.
Porsches and Bentleys, for instance, were out of stock for four months until May. Unit sales of Porsche dropped to 22 units, or 46.3%, in the review period from 41 a year earlier, while those of Bentley declined to three from four.
