Declining car market in Egypt raises concerns amidst economic challenges

The auto market in Egypt saw about 36,845 vehicles sold in the first half of 2023 - a decrease of 69.8 percent compared to 122,318 vehicles sold in the same period last year, according to a report by the Automotive Information Council (AMIC).

The economic downturn, coupled with persistent hard currency shortages, has created a challenging environment for the automotive sector, impacting passenger cars, buses, and trucks alike.

Passenger car sales dropped 71 percent year-on-year from January to the end of June 2023, with 26,869 units sold, AMIC's data showed. Bus sales also suffered a 56 percent YoY decline to 3,982, while truck sales plummeted by 71 percent YoY to 5,994 units.

Osama Abul-Magd, head of the Association of Automobile Dealers in Egypt, attributed the decline to a combination of internal and external factors affecting the local vehicle supply. He highlighted the energy crisis as one of the external factors disrupting global auto production, in turn affecting vehicle availability in Egypt. 

According to a report by S&P Global Mobility, the energy crisis is projected to reduce Europe's car output by nearly 40 percent in 2023. The study further highlighted that producing a single car requires over 55,000 megajoules of energy, equivalent to almost 1,800 litres of gasoline. 

Mahmoud Hammad, Head of the Used Car Sector at the Egyptian Automotive Dealers Association, stressed the importance of addressing the US dollar shortage as the first step in resolving the market's challenges.