Used vehicle dealers opt for short-term rental
Some used car dealerships resorted to renting vehicles for events due to weak sales attributed to global supply chain issues hurting imports.
Kenya imports most used vehicles from Japan and other Asian countries, but the Covid-19 pandemic has slowed production of new vehicles, which has had a spiraling effect on prices.
Most new car buyers overseas keep their vehicles much longer, reducing the number of units available for resale in developing markets. With sales declining due to rising prices, dealerships have created new revenue streams through car rental services.
“The economic crisis has affected us. During the pandemic, there were no weddings and we were bankrupt, but now it’s picking up,” said Mr. John Ndwati, sales manager at a car dealership in Nairobi.
He says weddings and other pompous events are coming back and some of the dealership vehicles are rented out.
“This limo [pointing at a parked goldish black limo] goes for 20,000 shillings an hour,” he said.
Weddings and ceremonies in Kenya are usually lavish functions hosting hundreds of people. The car rental business started selecting from used vehicle dealers since last year.
Some merchants, however, still remain strictly in the realm of sales.
“In our car shop, we strictly sell vehicles and do not rent them out,” said Ms Terry Mwihaki, a used car dealer.
Kenya’s wedding industry has been one of the hardest hit sectors of the economy during the pandemic.