Morocco August. Volkswagen soars 25.9% while the market went back on a negative path

Moroccan Cars Market

Moroccan Cars Market in August dropped down again, with 7.814 sales (-22.5%). The leader Dacia – losing 27.1% – held just 25.4% of share. Hyundai and Peugeot registered the same trend, declining over 25%. Volkswagen soared to an impressive +25.9%.

Economic Environment

Moroccan economic growth seems to have softened somewhat in the second quarter. The consumer confidence index plummeted to its lowest level since Q4 2016, driven by a broad-based deterioration in household sentiment, which bodes poorly for private consumption. Moreover, job creation was tepid in Q2, even though the unemployment rate fell as people left the labor force, and the agricultural sector shrank further according to Morocco’s Statistical Institute.

More positively, annual loan growth was robust in the quarter, which should have supported domestic demand somewhat. Meanwhile, in late July, the King announced the creation of a new committee tasked with suggesting economic reforms, and urged the prime minister to shake up key public-sector positions. It remains to be seen whether this will have any meaningful economic impact.

Market Trend

Morocco Vehicles Market in recent years is one of the best in the entire African continent. Based on economic and political stability, the industry is skyrocketing thanks to the Automotive National Plan introduced few years ago, with a clear and substantial incentive in support to attract international investors to develop and produce vehicles locally. Renault, the first investor acting in the country, is improving local plant capacity and actually export in near 70 markets, while PSA is opening the first plant in the country.

The domestic market is growing year after year, hitting in 2018 the fourth all-time record in a sting. Indeed, thanks to the robust demand on the LCVs segment, the year ended with registrations at 174.645, up 3.6%.

However, in January the market started the new year with a negative tone, down 15.9%, with sales at 11.529. In February sales were still negative, even though at a reduced speed (-1.3%). In March the trend has reversed, increasing sales by 20.5%, with 13.235 units sold and leading Q1 figures at 34.449 (-1.7%).

In April, sales crumbled down 38.2% – with 11.308 units sold – while in May fell down 9.1% with 11.512 units. In June, the market finally improved by 3.4% with 13.108 sales, keeping the same tone in July (+2.2%) with 12.084 units sold. However, in August registrations were hit by another drop (-22.5%) selling just 7.814 units, leading year-to-date figures at 90.271 (-10.2%).

The competitive landscape is still dominated by the Renault-Nissan Group which has the control of more than half of domestic sales.

Brand leader Dacia is keeping a negative trend (-10.5%), ahead of Renault with 13.755 (-3.3%). Hyundai ranks third, down just 1.9% from the previous year.

Market Outlook

After hitting a series of all-time records, the Moroccan market is seen to be moderately positive in the 2019-2025 period of time, despite it has started the new year on the wrong foot. Being interested to know more, give a look at this updated research. Clicking on the picture, you can see contents.