Kenyan Car buyers opt for Hybrids

Kenyan car buyers are choosing hybrid models in response to rising fuel prices and the high cost of living caused by the Covid-19 pandemic.

Dealers in used vehicles report an increase in sales of smaller vehicles and hybrids since the pandemic began.

To move the car, a hybrid combines at least one electric motor with a fuel engine, and its system recaptures energy through regenerative braking.

Sometimes the electric motor does all of the work, sometimes the gas engine, and sometimes both. As a result, less gasoline is consumed, resulting in improved fuel economy.

Kenyans have been forced to hold onto their wallets as a litre of unleaded super petrol costs around Sh160 and diesel costs around Sh140.

“At the moment small vehicles like Toyota Vitz because of their engine capacity have a high demand and trying to get them at the pump is very minimal,” said Ken Baraza, manager at Plus Point automobile shop on Ngong Road.

“The cost of fuel has affected the running cost of vehicles. Most people are now going for smaller engines and specifically, Toyota is advancing and manufacturing hybrid engines, which normally are very minimal in fuel consumption.”

Fuel prices are influencing purchasing habits, and there are early indications that people are reconsidering their purchases.

Toyota Vitz, Honda Fit, and Nissan Note, in particular, have become popular among Kenyan households as more people prefer smaller vehicles with displacements ranging from 1200 to 1800 cubic centimetres (cc).

The Vitz hatchback model, which has an engine capacity of about 1.5 litres, was selling for Sh1 million last year but has now risen to around Sh1.4 million.

Toyota, Nissan, and Honda are among the manufacturers of fast-moving hybrid vehicles.

Customers’ interest in more fuel-efficient cars, particularly hybrid vehicles, is growing, according to Nairobi used car dealers, despite parts shortages limiting the supply of new models.

According to Terry Mwihaki, manager of Lancet Motors, a used car dealership in Nairobi, Kenyans are purchasing more used BMWs and smaller vehicles.

“This month we have sold around 15 cars of between 1200cc and 1400cc averaging between Sh1 million and Sh2 million,” said Ms Mwihaki.

Ms Mwihaki cautioned first-time buyers that engine capacity and fuel efficacy are crucial considerations when buying a vehicle.

“You have to be very cautious when you’re getting a car, at Sh150 a litre [of fuel] that is a lot for a higher cc. For instance, if you get a 3000cc it will strain your pockets, so people are currently tending to go for the 1200cc up to two litres. That’s what is fast moving for us,” she says.

Global shortages of components such as microchips, exacerbated by Covid-19 restrictions in China, are limiting manufacturers’ ability to keep up with demand, according to auto dealers.

Car dealers and anyone in need of a cheap car are bearing the brunt of the pain.

Automobile manufacturers have been allocating scarce chips to high-end and other vehicles that generate the most profit, resulting in lengthy wait times for less expensive vehicles.

Some models are not available for delivery for more than a year. Because of the scarcity of new vehicles, used car prices are skyrocketing.

The sticker shock is expected to last as the repercussions of the Covid-19 pandemic, exacerbated by the Ukraine invasion, affect commodity prices and supply chain movement.

“Most people right now because of fuel prices are interested in hybrids because they use less fuel. We have sold about four hybrid fielders in the last month,” said a Nairobi-based car dealer.

The Vitz and Honda Fit have established themselves as the tiny yet roomy and sporty small vehicle benchmarks.

I bet you can’t drive for thirty minutes on Kenyan roads without seeing at least one of these vehicles.

Mr. John Ndwati, a sales manager at Valley Road Motors, agrees that smaller cars are selling quickly.

“Over the last year, we have not sold many larger vehicles, people shy away from models like Toyota Landcruiser V8 [with up to 4461 cc], because the car is a beast on fuel consumption,” said Mr Ndwati.

Local manufacturing, according to the dealers, can be an alternative to such global supply chain disruption.

The pandemic sparked a global debate about shifting away from globalisation and toward local sourcing for chips and many other industries in order to increase supply chain resilience.

They expressed hope that the government would continue to support manufacturers and local assemblers, especially since they pay high duties on imported cars.