Leaders in the automobile market expect a temporary decrease in prices to take place from July until the end of August.
Alaa El Sabaa, member of the General Automobile Division in the Federation of the Egyptian Chambers of Commerce (FEDCOC) said that any offers made by companies right now to reduce prices are a great opportunity for those who want to purchase automobiles, and they should seize the opportunity, as it will not happen again.
El Sabaa added that the prices will increase again after the end of August, explaining that the market is greatly impacted by the dollar prices and the interest rate.
He pointed out that there was a sharp decline in car sales by 45% during the first five months of 2017, where 46,000 cars were sold, compared to the same period in 2016 where 85,500 cars were sold.
A prominent source in the sector, who preferred to remain anonymous, told Daily News Egypt that companies are currently selling from the stock they have accumulated over the past months due to the decline in sales, specifically over the past four months.
Car pricing will be based on the cost of importing over the upcoming period after the stock runs out.
The source expected car prices to increase over the upcoming months after companies had to start their import deals for 2018 models. This will lead companies to announce the highest prices in the history of the sector, resulting in severe recession.
He explained that companies will be offering discounts during the second half of this year in order to get rid of the stock of model 2016 and 2017 cars. The companies will also compensate the profit margins of these models through increasing the prices of the new 2018 models.
The source expected a sharp decline to take place in the sales of the market by the end of this year to near 40% compared to what the market was able to achieve last year. This will be the result of the flotation of the pound and the amendments to the custom dollar price. Reports expect the value of the dollar to increase during fiscal year 2017/2018.
Khaled Saad, the general manager of Brilliance in Egypt, said that the sales of the market have witnessed a 45% decline during the first five months of this year, compared to the same period in 2016, due to consumers abstaining from making purchases as a result of the recent price hikes that took place during the first four months of the year. He expected the market to close the sale of this year at declines of 40-50%.
He added that the return of a custom dollar increase will put the sector in a state of recession due to the expected increases in car prices.