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Strategy: How the Chinese are setting themselves up for success

May 28th, 2013 7 comments

Fennec fox. Picture courtesy of Fransisco Mingorance:National Geographic Traveler Photo ContestLike this fennec fox, Chinese carmakers have been walking against the wind in Africa. And it’s worked.

* This is Part 1 of 5 in my series on Chinese carmakers abroad See also Part 2 (Latin America)Part 3 (Eastern Europe)Part 4 (Asia) and Part 5 (Mature markets) *

For the first time in the history of car manufacturing, Chinese carmakers sold 1 million cars outside of China in 2012. They are now relying more and more on export markets to boost their bottom-line, especially as conditions have worsened for local passenger cars at home over the last couple of years. However as I described in my article “China: How local brands may finally find their mojo at home“, the Chinese are learning how to sell low-cost overseas and applying these strategies at home, making themselves more competitive in the process.

In fact, while the long-dreaded Chinese ‘invasion’ of the West European and American car markets is still a long way off, Chinese manufacturers have been working extra-hard under the radar to secure less developed markets that will form the bulk of the global car sales growth over the next couple of decades.

And this is why they will win.

Speranza A516 EgyptSperanza A516 in Cairo, Egypt

First case in point, Africa.

Apart from Toyota, Hyundai and a bunch of other Japanese manufacturers, no one currently has a lot of time for a continent that is still finding its way into development. Except the Chinese who started assembling cars there almost a decade ago, as part of a push to be deeply involved in the infrastructure building of the continent. So we’re not just talking cars, but roads, rail tracks, mining and much more.

Egypt was the first cab off the rank when Chery used the Cairo plant previously run by Daewoo to assemble its cars under the Egypt-exclusive Speranza brand in 2004 – apparently because the Chery brand suffered poor quality perceptions after an earlier launch there. Success: Speranza was the 4th most popular passenger car brand in Egypt between 2008 and 2011, selling more than Toyota! Successful models include the A516 (#9 from 2007 to 2009) and the Tiggo (#14 in 2011). Since 2012 however, other Chinese manufacturers have stepped up a notch in Egypt…

Golden Dragon Haice Egypt 2012The Golden Dragon Haice was the best-selling Chinese model in Egypt in 2012.

The Golden Dragon Haice managed to rank as high as #6 in September 2012 and finished the year as the best-selling Chinese model at #15 while the Geely Emgrand EC7 also has already peaked at #6 and 3.8% share in March 2013 less than a year after its initial launch in the country. King Long, Brilliance and JAC models have also started to appear within the monthly Top 30. As a whole,
Chinese manufacturers commanded 9% of the overall Egyptian market in 2012, which as you will see below is actually not their best share in the continent…

Holland Car Abay V2Holland Car assembles the Abay (aka Lifan 520) in Ethiopia.

In Ethiopia, Lifan and JAC have cooperated with Holland Car, the country’s first car brand, to assemble models locally including the Holland Car Abay (a rebadged Lifan 520),Tekeze (JAC Tongyue) and Awash (JAC B-Class), all named after Ethiopian rivers. Since 2010 Lifan assembles cars under its own name in the country and has recently introduced the X60 SUV. No sales data for that country so it’s hard to gauge their success (not as high as Lifan would want according to somalilandpress.com) but a second example of clever re-branding to fit the local culture as a first step.

Foton Slip SUP Kenya 2012The Foton SUP is assembled in Kenya since 2011.

In Kenya, Foton launched its first domestically produced truck, the SUP pick-up, in June 2011 using an existing local factory, and has opened its own US$50m assembly plant in Nairobi in March 2012 with a capacity of 10,000 annual units. Chery is also thinking about a Kenyan plant, initially limited to produce 1,000 units in 2013. As a result, Chinese manufacturers now hold 20% of the Kenyan car market…

Geely Emgrand EC8 Kuwait. Picture courtesy of qabaq.comGeely Emgrand EC8 in Kuwait

Either from these 3 assembling hubs or through straight exports from China, Chinese carmakers are organising their expansion towards other African countries. The Egyptian hub makes it more practical to export to Libya, Algeria, Sudan, Syria, Jordan, Saudi Arabia, Kuwait, the UAE and Iraq notably, where the Great Wall Deer seems to be particularly successful. Another potential hub for the region could be Iran where Chery has been assembling cars since 2006, with the Fulwin 2 hitting a record #4 last month.

JAC Tojoy MadagascarJAC was the #2 most popular brand in Madagascar at the end of 2012.

Ethiopia and Kenya can also be used as relays to Tanzania, Mozambique or Madagascar where JAC already has an extremely solid presence (#2 brand with over 8% share) below just Nissan in Q3 2012. Further West, Chinese carmakers now hold 20% of the Senegal and Cote d’Ivoire markets, with latest Cote d’Ivoire showing Great Wall at #10 in 2010. The logical next step in Western Africa for Chinese car makers would be assembling cars in Nigeria…

Assembling cars in Nigeria would enable them to carve up a significant market share there as well as in neighbouring Ghana, Cameroon, Gabon, Mali and Burkina Faso, all at various stages of development but destined to grow fast in the next decade and beyond. South Africa also seems to be a missing link right now, however when you realise that it is actually the only mature market on the continent, it’s easier to understand why the Chinese haven’t spent too much energy trying to crack it yet. I will spend more time talking about Chinese carmakers’ strategies in mature markets in Part 5 of this series.

ZX Auto GrandTiger Libya 2011aZhongXing/ZX Auto GrandTiger in Libyan Civil War outfit

Another way Chinese models have come under the spotlight in export markets has been through government agreements, notably in Libya, albeit in a totally unexpected way (you will see its impact on the Cuban car market in the next installment of this series). During the 2011 Arab Spring, Libyan rebels got their hands on a batch of 5,000 ZX Auto GrandTiger pick-ups that the government had recently received and fit their heavy artillery on them, catapulting the vehicle onto worldwide TV screens for a solid 6 months. A marketing opportunity that ZX Auto fully embraced, boasting about its reliability and featuring the Libyan civil war on giant LED screens at the 2012 Beijing Auto Show (see the full Libya article here).

Stay tuned for Part 2 of this series: Latin America!

Senegal: The only country in the world to crown Mitsubishi?

April 29th, 2013 4 comments

Mitsubishi L200 Senegal 2013Could the Mitsubishi L200 top the Senegalese models ranking?

* See the Full article by clicking on the title! Many thanks to Andrea *

Up until today I had not managed to get official sales information by brand for Senegal but thanks to Andrea we now have a little bit more insight on this sub-saharian market, and The Africa Project continues to map out this fascinating continent little by little. Granted, the data is a little… well dated as it is from 2008 when an estimated 6,000 new vehicles were sold in the country.

Dakar Alexandre FoulonStreet scene in Dakar, Senegal. Picture by Alexandre Foulon, all rights reserved.

However it reveals a very interesting fact about the Senegalese market: that Mitsubishi leads the manufacturers ranking ahead of Toyota, Ford and Volkswagen. If confirmed and still valid in 2013, this would make Senegal the only country in the world where Mitsubishi is crowned. The Japanese manufacturer’s previous “best” was the Philippines where it currently ranks #2.

Previous post: Senegal: Toyota Hilux favourite, Peugeot losing grip

Full article below.

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Categories: Africa, Senegal

Tunisia Full Year 2012: Renault, Volkswagen & Peugeot dominate

March 7th, 2013 3 comments

2013 Renault Symbol Tunisia 2012The new Symbol should enable Renault to stay on top in 2013.

* See the Top 30 best-selling brands by clicking on the title! Many thanks to Alexandra *

Car sales data for Tunisia is very rare to come across but thanks to Alexandra I am able to share with you an all-brands ranking for Passenger Cars only for the Full Year 2012. Note this ranking does not include Light Commercial Vehicle sales which was the case for my last Tunisian update. New car sales in Tunisia are up a very healthy 15% year-on-year in 2012 to 37,132 registrations. Renault remains the most popular carmaker thanks to 6,207 units and 16.7%, however down from 18.9% in 2011. Volkswagen ranks #2 again in spite of sales down 11% to 5,140 and 13,8%. The German manufacturer is now threatened by Peugeot, up one spot and an impressive 28% year-on-year to #3 with 5,095 sales and 13.7%.

2013 Peugeot 301 Tunisia 2012. Picture courtesy of Beirutnightlife.comThe arrival of the 301 could mean Peugeot will rank #2 in Tunisia in 2013…

Further down, Fiat drops one rank and 11% to #4, Kia remains #5 but is up only 1% to 9.3% share vs. 10.6% in 2011, Citroen is up 33% to #6, Ford up 57% to #7, Chevrolet up 81% to #8, Seat up 19% to #9 and BMW up 59% to #10. Notice also Toyota up 29% to #11, Mitsubishi up 298% to #13, Mercedes up 80% to #14, Hyundai up 1389% (!) to #15, Mazda up 394% to #17, Opel up 122% to #19, Land Rover up 256% to #22 and Lancia up 625% to #24.

Previous post: Tunisia August 2012: Renault, Peugeot and Citroen on top

Full Year 2012 Top 30 All-brands Ranking Table below.

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Categories: Africa, Tunisia

Nigeria Full Year 2012: Toyota up 30% in declining market

February 26th, 2013 2 comments

Toyota Hilux 2012Toyota Hilux

* See the Top 7 best-selling brands by clicking on the title! Many thanks to nami *

After growing by 15% over the first 6 months of the year thanks to bank credit starting to trickle in, new car imports in Nigeria are back down by 5% over the full year to 48,490 registrations. One brand stands out from the crowd: Toyota, up a massive 30% year-on-year to 19,755 sales or a mammoth 40.7% market share which is over 10 percentage points higher than in 2011 when it held 29.7% of the market. Far below we find Kia at 5,034 units and 10.4% and Hyundai at 4,259 sales and 8.8%, adding up to just over 19% vs. 28% in 2011. Ford is up 4% to 2,613 units thanks to the Ranger and Honda is up a huge 58% to 2,473 sales.

Previous post: Nigeria 6 months 2012: Toyota grabs 35% of recovering market

Full Year 2012 Top 7 brands Ranking Table below.

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Categories: Africa, Nigeria

South Sudan 2012: Toyota Land Cruiser should top sales charts

February 11th, 2013 3 comments

Toyota Land Cruiser South Sudan by KohsahToyota Land Cruiser Prado. Picture by Kohsah, all rights reserved.

Today we welcome a new country on BestSellingCarsBlog, one that actually acquired its independence after this site was created. The Republic of South Sudan became officially independent from Sudan in July 2011. There is no available information about the best-selling models and carmakers in this country online so if you come across any data at all please do comment on this article so we can all improve our knowledge of this African market.

First observations through YouTube videos of the capital city Juba show a surprisingly high amount of new cars (compared to neighbouring countries in the region) probably purchased by the non-government organisations present in the country. The Toyota Land Cruiser Series 70, 200, Hilux and Land Cruiser Prado (in this order) should top the sales charts as they are omnipresent in the streets, with literally no other new model apart from the Mitsubishi Pajero and Toyota Hiace showing off their new bonnet.

More South Sudan street videos below.

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Categories: Africa, South Sudan

Kenya December 2012: Toyota Land Cruiser most popular

February 11th, 2013 2 comments

Toyota Land Cruiser Kenya December 2012Toyota Land Cruiser

* See the Top 3 best-selling models and Top 5 carmakers by clicking on the title! *

Thanks to the hard work of Rutger I am able to share with you some very rare data about the Kenyan new vehicle market, up a shy 1% year-on-year in 2012 to 12,798 units. This is the “the slowest growth since 2009 when reduced economic activity due to the post-election and global economic meltdown cut orders by 20%”, says local website Business Daily Africa. General Motors East Africa, mainly distributing Isuzu light and heavy commercial vehicles, maintains its lead over the Kenyan market with sales up a robust 9% to 3,421 units for a 26.7% market share. “We had a lot of orders for our Isuzu buses last year. We could not supply all the units in 2012 and the strong order book is keeping us busy in this first quarter,” says Rita Kavashe, GMEA’s managing director.

The saloon car market has come under serious attack from imported second hand vehicles over the past 5 years, increasing the pressure on Toyota, up just 3% at #2 with 3,099 sales and 24.2%, and CMC Motors, which deals in Land Rover, Volkswagen and Ford models, down to #5. Model-wise, in December the Toyota Land Cruiser takes the lead with 108 sales and almost 10% share, followed by the Mitsubishi Diesel 9-tonne truck and the Toyota Hilux Double Cab.

Previous post: Kenya May 2012: Isuzu Pick-up dominates models ranking

Full December 2012 Top 3 models and Full Year 2012 Top 5 carmakers Ranking Tables below.

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Categories: Africa, Kenya

Angola 2011: Hyundai leads, potentially places ix35 #1, Suzuki Celerio #2

December 3rd, 2012 No comments

Hyundai ix35

* See the Top 5 best-selling brands by clicking on the title! Many thanks to José *

Thanks to José I can now share with you actual data for 2011 in Angola for the very first time on BSCB as part of The Africa Project. In 2011 the Angolan new car market was up by a huge 32% year-on-year to 23,390 registrations, nearly back to the pre-crisis levels of 2008 and 2009. The passenger car segment accounts for 72% of the total market and grew by 38% in 2011. At this stage there is only a Top 5 brands ranking but this is way better than my YouTube estimations to-date! As we learnt a few months ago, Hyundai is the most popular carmaker in the country but the new news is that it totally dominates the landscape with 5,901 sales and 25.2% share.

Suzuki Celerio

This is nearly double the #2, Suzuki at 3,275 units and 14%, and more than double the sales of Toyota, Hyundai’s big opponent on the African continent, at 2,871 units and 12.3%. Chevrolet and Kia round up the Top 5 brands in Angola. Model-wise, the data is more sparse, but given Hyundai’s domination and based on the traffic in Luanda, I will venture the guess that the Hyundai ix35 is the best-selling model in the country.

Suzuki Jimny

At least we now know that the Suzuki Celerio is #2 with 1,465 sales and 6.3%, the Suzuki Jimny is #5 at 1,080 units and 4.6%, the Chevrolet New Spark at #8 and Chevrolet Spark Lite at #9. An interesting trend in Angola is the emergence of a new middle class that buys practical cars like the ones above along with the Chevrolet Sail, and the proportion of sales going to businesses declining. Most private buyers purchase with cash upfront with only 7% of sales going through bank financing.

Previous post: Angola 2011 (estimation): Mitsubishi L200 and Toyota Hiace solid, Suzuki Celerio, Hyundai ix35 and Kia Sportage impress

Full Year 2011 Top 5 Ranking Table below.

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Categories: Africa, Angola

Best Selling Cars Blog: The Africa Project

December 1st, 2012 1 comment

Street scene in Djenne, Mali. Picture by Leonid Plotkin, all rights reserved. 

* Click on the title for the direct links to 47 African countries covered on BSCB! *

This Africa Project update is brought to you by online car insurance from Auto Insurance.

A few months ago, I launched the Africa Project on Best Selling Blog to try and bring African countries to a similar level of data and car sales information as the rest of the world. I want to thank you all for contributing to the Africa Project to date, with notably a monthly coverage resumed for Algeria thanks to Mermou, Historical information for Rhodesia (Zimbabwe) between 1958 and 1980 thanks to Frank and exclusive models and brands ranking for Kenya thanks to Myk plus a look at how Hyundai is ahead of Toyota in 5 major African countries including South Africa.

The BMW Cheetah was a rebadged Glas 1700 assembled in Rhodesia in the sixties.

But there is still a lot of work to do and many countries to explore, so I encourage you to keep contributing to The Africa Project by sending/shairing any piece of information you have, even if it’s just observations you have made when you visited various African countries. Once/if BSCB gets bigger, I may have the possibility to travel to these regions to report about them myself, but for now my own experience of Africa is very limited.

If you live in Africa or have data on any African country please be sure to get in touch by filling the ‘Contact us’ form I will contact you right away.

There is a revitalised interest towards Africa in France right now.

In terms of new car sales Africa is the last frontier, with only a few countries having set up regular reports. However no less than 1.4 million cars were sold on the African continent in 2011, and even though it is still plagued with war and poverty in some parts, it is now developing fast. The African Bank of Development predicts 4.5% economic growth for the region in 2012 and 4.8% in 2013, with peaks at 6.9% in Western Africa and 5.6% in the East.

Indeed, one of the things I noticed during my last stay in France is the revitalised interest, focus and introspection towards the African continent, with which France has long running cultural and economical links. French rap band Sexion d’Assaut recently released the song ‘African’ (the video clip shot in Senegal is above), a harsh, realistic and at times humorous view on how Africans are perceived in France and abroad. In the car world, this renewed interest translates into statements like Peugeot’s, refocusing its energy on sub-Saharan Africa in 2012.

On top of this, Japanese carmakers Toyota, Nissan and Honda have had decades of strong sales in the region, and lately Chinese manufacturers have landed en masse, making Africa a fascinating continent to follow, and this is why I want to make it a special focus on Best Selling Cars Blog.

The Dacia Lodgy is assembled in Tangier, Morocco.

Problem is, new car sales reporting is still quite disorganised and I only have data for a few countries. South Africa, by far the biggest African car market at 570,000 sales in 2011, Algeria (#2 at 300,000) and Egypt (#3 at 176,000) are the only 3 I am able to cover monthly. There are still a lot of unknowns…

So this is where you come in dear readers.

If you work in the car industry anywhere in Africa, within organisations that would have the potential to bring together some car sales data, or if you just happen to have sales info, please do get in touch by filling in the ‘Contact us’ form.

I would like to build Best Selling Cars Blog towards the site that gives reliable sales data for as many African countries as possible so everyone can have a better understanding of this fascinating and fast evolving market, so I’m counting on you BSCB readers to improve the coverage on Africa! Many thanks in advance for all your help.

See the direct links to the 47 African posts below.

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Categories: Africa

Rhodesia (Zimbabwe) 1958-1980: Historical Info now available!

September 27th, 2012 18 comments

The Renault 4 was the most successful model in Rhodesia over the period

* See the Top 25 most produced models by clicking on the title! Many thanks to Frank *

Today the Africa Project is getting its first historical contribution, thanks to Frank Stevens. Frank was born and grew up in what was used to be Rhodesia up until 1980 when it became Zimbabwe, one of the most tumultuous times the country has known. During that period, up to 17 car manufacturers assembled models in a country plagued with United Nations trade sanctions, and thanks to Frank who also worked at the National Vehicle Registration Department there in the seventies, I am able to share with you the best-selling models in Rhodesia from the late fifties to the early eighties. Fascinating info if you ask me!

1958 Pontiac Strato Chief

In the fifties Rhodesia, being part of the Commonwealth, truly benefitted from the American and European export drives. The most popular models in the country at that time included the Chevrolet Impala, Dodge Polara, Pontiac Strato Chief, Ford Galaxie 500, Plymouth Fury and Mercedes 220 fintail, sharing the roads with the Austin 1100, Wolseley 6/110, Skoda Octavia, Borgward Isabella, Taunus 17M, Ford Zodiac and Anglia, Jaguar S type, Opel Rekord, Vauxhall Victor, Volvo Amazon, Holdens and even the odd Datsun…

1963 Isuzu Bellett

In 1958 BMC opened an assembly plant in Umtali (now Mutare), and Ford did the same in 1960 at Willowvale in Salisbury (now Harare) with the two brands likely dominating sales in Rhodesia in the early sixties. However the Unilateral Declaration of Independence from Britain in 1965 triggered UN trade sanctions against Rhodesia from 1966 until the creation of Zimbabwe in 1980. As a result BMC and Ford stopped supplying CKD kits and by 1967 there were very few new cars available, except save for the occasional Isuzu Bellett and Daihatsu Compagno.

Peugeot 404

From 1968 onwards, the composition of the Rhodesian new car market changed drastically as sanctions busters found new sources of CKD kits and new brands made their appearance on the streets. Thanks to Frank’s meticulous observation and note-taking when working at the Vehicle Registration Department at the time, I am able to share with you the most produced (and therefore best-selling) models in Rhodesia from 1966 to 1980.

Datsun 120Y

Interestingly, the Frenchies dominate the ranking with 4 models in the Top 5… The Renault 4 is likely to be the best-seller over the period ahead of the Peugeot 404 in all its formats (sedan, station-wagon, pick-up) with the Datsun 1200/120Y/140Y rounding up the podium. The Renault 12 and 10 follow while the Datsun 1500 pick-up ranks #6.

The BMW Cheetah/2000 SA was a rebadged Glas 1700 assembled in Rhodesia

The Alfa Romeo Giulia ranks #7, the Mazda B1600 pick-up is #8, the BMW Cheetah #9 and the Peugeot 304 #10. Other interesting entries include the Citroen DS at #11, the Alfasud at #14, the Toyota Corolla Mk2 at #18, the Peugeot 504 at #22 and the VW 1300/1600 bush buggy at #24.

Previous Zimbabwe post: Toyota Corolla sovereign, info needed

Info on Rhodesia assembled BMWs, the Rhodesian Bush-War and Full 1966-1980 Top 25 Ranking Table below.

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Categories: Africa, Zimbabwe

Africa: Hyundai ahead of Toyota in 5 major countries!

September 25th, 2012 1 comment

The Hyundai Elantra was elected 2012 Car of the Year in South Africa

* See more info by clicking on the title! *

Just as Hyundai kick starts its brand new Brazilian manufacturing plant in Piracicaba, Sao Paulo with an annual production capacity of 150,000 vehicles and targeting 10% of the local market with the made-in-Brazil-for-Brazilians Hyundai HB20, extremely rare sales figures for Africa were released by The Korea Herald. Hyundai has been competing closely with Toyota to become #1 in Africa, posting monthly sales growth rates of about 50% on average in the region.

Hyundai is currently #2 in Africa with about 12% share of the continent’s market with Toyota leader at 14.7%. However, The Korea Herald says Hyundai has surpassed Toyota in five major countries: Algeria, Angola, Morocco, Egypt and South Africa. For Algeria, Morocco and Egypt, if you are a regular BSCB reader this will come as no surprise to you as sales figures are regularly available and show clearly Hyundai doing much better than Toyota there. This is mainly thanks to models whose previous generations are still on sale at low prices: the Verna, a 2000 Accent, is #1 in Egypt and was #3 in Algeria in 2011, while the 2004 Hyundai Atos was #2 there.

The Hyundai Verna is #1 in Egypt

For Angola this is new news to me as this market is still very secretive when it comes to car sales figures. The big surprise is South Africa, simply because Hyundai oddly does not release any sales figures for that country… which is a shame because Toyota sold 7,325 Passenger Cars in South Africa in August (#2 behind Volkswagen) and 4,622 Light Commercial Vehicles (#1 ahead of Chevrolet) for a total of 11,947 vehicles overall, placing it #1 well ahead of Volkswagen at 9,898 units. This means if The Korea Herald are correct, Hyundai is simply #1 in South Africa, by the largest car market in Africa!

Another piece of interesting information released by The Korea Herald is the fact that sales in the above five nations account for more than 80% of all automobile sales on the African continent, which means Hyundai is putting itself in a very good position to grab the overall lead in Africa in the near future.

See the source of this article below

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Categories: Africa