10 facts about the current state of the automotive industry in Egypt

The automotive industry in Egypt has seen a lot of ups and downs in the last few years and steps are being taken to alleviate these effects and revive the market. Here are 10 key points summarizing the current state of the automotive industry in Egypt:

1. Prolonged crisis: Egypt's automotive market has experienced instability and significant stagnation since March 2022, largely attributed to various domestic and international factors.

2. Impact of the Russia-Ukraine war: The outbreak of the Russia-Ukraine War disrupted global supply chains, adversely affecting Egypt’s automotive industry by creating supply shortages and increasing prices.

3. Economic factors: The flotation of the Egyptian pound and scarcity of the US dollar have escalated the crisis by making car imports more challenging and costly.

4. Mismatch of supply and demand: There's a prominent mismatch between the supply of new cars and market demand due to supply shortages, which have driven prices significantly above the products' intrinsic value.

5. Sales decline: The first eight months of 2023 witnessed a 65.5% decline in automotive sales in Egypt, with only 51,167 vehicles sold compared to 148,461 in the same period the previous year.

6. Specific sales downturn: There were notable decreases in specific vehicle types - passenger car sales went down by 65%, bus sales by 55.7%, and truck sales by 70% compared to the previous year.

7. Import reduction: Imports of passenger cars plunged to $1.915 million in 2022 from $3.664 million in the preceding year, reflecting a significant challenge for the availability of new vehicles in the market.

8. Persistent chip shortage: A shortage of electronic chips, which began during the COVID-19 pandemic in 2020 and persisted through 2021, continues to hamper the automotive sector, exacerbated by ongoing global conflicts.

9. Shifts in consumer purchasing power: The reduced stock and fewer imports of automobiles, along with the sharp rise in prices, have notably diminished consumer purchasing power.

10. Governmental measures: The Egyptian government has introduced strategies and incentives aimed at localizing the automotive industry. This includes a strategy launched in 2022 to establish Egypt as a primary gateway for emerging vehicle markets in Africa.