Algeria new cars market reported a deep down in the third quarter of the 2015 hit by recession generated by sharp fall in the oil price and measured taken by the government to sustain the budget. Renault shines.
After the government announced last month that public spending would be cut by 9.0% next year, a draft of the 2016 budget showed that the government is also planning to raise taxes, impose import duties and slash subsidies on diesel and electricity in order to alleviate a soaring trade and government deficit.
Exports of oil and gas, which represent 90% of total exports and two-thirds of government income, are on track to fall by more than 50% this year and are expected to drop again next year. OPEC announced earlier this month that their forecast for oil demand in 2016 had been trimmed further.
The fact that subsidies are being cut amid continuing declining oil prices raises concerns as subsidies are used to alleviate tensions within the country.
Algeria automotive industry and domestic car sales are struggling in the 2015 due to the harsh economic conditions created by the sharp decline of oil price in the international markets and the following actions taken by the government to sustain the budget, cutting expenses and raising taxes.
First half sales were reported dow 10.1%while the trend deteriorated in the third quarter. Indeed July was down 18.5% while August and September were both down 19.5%.
During the first nine months of the year, sales had been 224.550, down 13.0% from the correspondent period last year and next perspectives are even worse.
The surprise is that the three best-seller brands are not declining as all the others competitors. Renault has sold over 39.000 vehicles (+6.1%) followed by Peugeot with 29.351 (+1.7%) and Dacia, flat at 26.688.
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