Algerian vehicle market fell in double-digit during the first half 2015 hit by government measures restricting imports of new car that have advantaged the French makers and penalized all the importers. Chinese brands are growing.
The latest data confirm that low energy prices are having a significant negative impact on the Algerian economy. Exports, predominantly oil and gas, fell more than 40% annually in the first half of the year. Algeria posted a USD 7.8 billion deficit during this period, contrasting the USD 3.2 billion surplus recorded a year earlier.
The poor external sector performance represents a problem for the government’s finances given that oil and gas export earnings provide the government with two-thirds of its budget. In fact, the government announced on 23 July that it would trim spending in the 2015 budget by 1.35%, amid expectations that low oil prices will reduce its energy earnings this year by 50%.
The government will likely struggle to keep up with infrastructure investment plans and fully maintain the generous welfare and subsidy system that has helped ease social unrest in the past.
A more severe rules on the import of pre-owned vehicles has boosted the new vehicle demand in the 2012 and the market reported a period of fast growth for two years, with both 2012 and 2013 hitting the new all time record.
However, Government new measures restricting imports of new car have hurt the Algerian kicking off a falling period, with 2014 figures landed at 340.000, down over 19% from the previous year and the 2015 still in turbulent environment.
Following a first half down 8.0%, in the second the demand was further lowered with first half figures at 156.970 units, down 10.1% from the correspondent period last year.
Renault is the market leader with 26.653 sales (+5.8%) in the period, followed by Dacia with 21.263 (+21.2%) and Peugeot with 20.217 (+1.6%), while the non-French competitors reported double-digit declines, with Hyundai -24.2%, Toyota -16.1%, Volkswagen -28.4%, Kia -11.6%. Just Chinese new players are growing.
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