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Why Buyers Are Now Running Away From Popular Used Toyota Cars

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As it has been noted that Kenyans are now running away from the popular used Toyota car models, contrary to what has been a tradition in the country. The rise in their costs has seen even dealers cut down on imports of these vehicles due to decreased demand.

Traditionally, popular models such as Toyota Premio and RAV4 have been synonymous with middle-income earners over the years. However, this is no longer the trend.

Car dealers say more Kenyans are now going for vehicles such as Nissan Sylphy and Mazda, which cost less compared with popular Toyota models.

Toyota Vs Nisaan and Mazda models

According to Charles Munyori, the secretary-general of Kenya Auto Bazaar Association, Nissan Sylphy and Mazda’s CX5 and Axela, are quickly gaining popularity among Kenyans.

Mr Munyori said the price of a Toyota RAV4 has short up to Sh3 million currently from Sh2.8 million in February while a Premio is going for Sh2.2 million from Sh2 million four months ago.

On the contrary, Mazda Axela is now selling for Sh1.6 million with Nissan Sylphy (Blue Bird) going for at least Sh1.5 million.

Currently, consumers find these brands to be the best alternatives to their preferred models, as they are relatively cheaper and good.

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With the rising household costs, these car prices are making them affordable to most Kenyans as they struggle to balance the high cost of living.

“We are seeing a shift where Kenyans are now moving from the popular brands such as Toyota Premio and RAV4 to other models. This shift has been occasioned by the high cost that these cars are now fetching at the market,” said Mr Munyori.

“In fact, most of the car dealers are hardly bringing in Premio and RAV4 models because they are not moving and they will tie up money that they would need for importation of more vehicles,” he said.

Ex-Japanese vehicles

Ex-Japan vehicles dominate the Kenyan second-hand sector with a more than 80% market share.

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The buyers in the sector prefer these cars as their spare parts are easier to obtain locally compared to other brands. Additionally, buyers believe that the resale value of Toyota vehicles are higher than that of other brands like mazda or Nissan.

Reasons for risisng vehicle cost

The rising cost of vehicles in the country has been linked to the unavailability of dollars locally, a shortage of electronic chips in Japan, and a weakening shilling against the dollar.

The country is currently experiencing extreme dollar shortage, that one has to wait for at least three days to get $20,000 or $25,000 from the banks.

“We have to wait for like nine days in order to accumulate $80,000, and this has seen car dealers delay in making their orders. We are really feeling the impact of the dollar shortage in the market,” Mr Munyori said.

banks have imposed regulations on dollar purchase. This has forced traders to face difficulty in meeting their obligations.

Industrialists are forced to start seeking dollars in advance. The shortage puts a strain on supplier relations and the ability to negotiate favourable prices in gap markets.

On the other hand, Semiconductors are used in making electronic devices. Their shortage has forced the vehicle manufacturers to scale down the production. The quantity and quality cannot be maintained with decrease in one of the crucial raw material.

Finally, the shilling has persistently remained weak against the dollar. this has made it costly for importers shipping in goods.

The shilling has hit a record low trading at of Sh 117.06 against the dollar. This predicts a continued rise in imported goods, and signifies a further dollar shortage crisis.

The continuous depreciation in shilling stability is attributed to increased demand for dollars from importers. This highly arises on importaion of crude oil and merchandised goods.

It should be noted that most external debt is repaid in the dollar. Therefore, a weakened shilling increases prices of imported goods, and puts pressure on the country’s debt repayment.

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How KRA Earned Sh50bn From Banks, Despite Covid-19 Pandemic

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Despite the severe effects emerging from the Covid-19 pandemic, Kenyan commercial banks were reporting double-digit profitability growths resulting from the global crisis, earning huge dividends for their shareholders.

It can be noted that most government institutions discouraged cash transactions in order to contain the pandemic level. This directly promoted digital transactions like mpesa and m-banking.

Besides owners, a new survey has shown that Kenya Revenue Authority(KRA) was the second best beneficiary of the supernormal profits.

According to PricewaterhouseCoopers (PwC) report, more than a quarter of corporate taxes paid to KRA in the year to December 2021, came from banks.

Corporate taxes

On Wednesday, a report was released on behalf of the Kenya Bankers Association (KBA), indicating the corporate taxes paid to the KRA surpassed 22.82% to Sh50.7 billion. A year earlier, the sector’s corporation tax payment amounted to Sh41.28 billion.

Banks are among the most profitable institutions in Kenya. They are among the biggest revenue generators in a country where tax compliance among corporates is at a low level.

The taxation law requires local companies to pay 30% of their profits as corporate taxes.

A whooping Sh198.24 billion was the total corporate tax paid in Kenya last year, with banks accounting for 25.57% (Sh50.7 billion) of the amount.

“The increase in 2021 compared to 2020 was largely driven by increase in profits with the profit before tax of the banks increasing by 85.17 percent in 2021 relative to 2020,” said the report.

“The profit before a tax increase is aligned to increased economic activity in 2021 as reflected by the GDP growth which grew from a contraction of 0.3 percent in 2020 to 7.5 percent in 2021.”

Check out: Kenya Exits Top 10 UN World Suppliers

According to KRA, the banking sector includes 44 listed lenders, 7 micro financiers, 16 SACCOs, and 38 custodian banks, not forgetting international financiers and bureaus with local offices.

The study focused on both the corporate tax and Value Added Tax (VAT) that it is not able to recover (irrecoverable VAT). Also, the taxes that banks collect as an agent of government such as PAYE.

Overall, the banking industry contributed Sh129.52 billion in taxes accruing from day-to-day operations in the year under the review.

Documented filings from 38 banks which participated were relied on. This represents 97% of the market share.

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Kenya Exits Top 10 UN World Suppliers

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A new report has indicated that Kenyan businesses’ supplies to United Nations (UN) agencies dropped by 11% by last year. This has edged out the country from the top ten spot.

During the period, Kenya’s supplies reached a Sh62.4 billion value compared to the Sh70.3 billion worth of goods supplied a year earlier. A drop of Sh7.9 billion occurred.

However, the report did not give reasons for the drop.

It can be noted that last year was markedmuch affected by Covid-19 pandemic which started in 2020. The pandemic severely affected businesses both locally and globally, destabilizing operations of multinational agencies.

Short-term disruptions rose from the pandemic, provoking long-term changes in daily world operations like business and lifestyle.

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However, contrary to kenya’s supply ability, its continental brothers like Nigeria and Ethiopia experienced an increase in the supplies. Parhaps, the reason(s) for the controversy was not revealed in the report.

“Procurement from suppliers in Africa rose by $303 million overall due to increased procurement activity by WFP (World Food Programme), IOM (International Organization for Migration) and UNICEF in particular,” says the report.

“Kenya, the largest country by procurement volume in the region, experienced a $67 million (Sh7.9 billion) decrease in procurement between 2020 and 2021, while procurement from suppliers in Nigeria and Ethiopia increased by $92 million (Sh10.8 billion) and $89 million (Sh10.5 billion), respectively.”

Health, the largest procurement sector of the UN system

The largest procurement sector of the UN system remained to be Health.

The sector’s procurement nearly doubled in 2021 to 2020(from $10.6 billion (KSh1.2 trillion) to $5.5 billion(KSh649 billion) respectively.

It should be noted that the UN had increased procurement at the period, as it highly participated in the comabatment of the pandemic.

“A significant part of the increase in the sector was driven by procurement related to Covid-19 vaccines and their distribution,” said the UN whose agencies.

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Science, engineering and construction, were the second-largest sector.

In 2021, procurement in the above sectors represented 12% total UN procurement, hitting $3.5 billion (Sh413 billion.

World’s top UN suppliers

In 2021, the UN sourced goods and services from suppliers in 223 different countries and territories. This represented growth across all geographical regions.

The US maintained its top spot as the giant supplier to the UN. During the period, US supplied goods worthSh271 billion to UN.

Mexico tied the US at the top spot as it supplied goods of the same value in the period.

The UN complex in Kenya

Several UN agencies are hosted in the country, including the UN headquarters in Africa.

See also: Aliko Dangote, how a USD500,000 loan built a USD20Billion net worth June 2022

The complex which lies in the capital city of the country, is the administrative centre of two main UN agencies: United Nations Environment Assembly (UNEA) and the United Nations Human Settlements Programme (UN-Habitat).

Additionally, the centre hosts the global headquarters for two programmes — the United Nations Environmental Programme (UNEP) and the United Nations Human Settlements Programme (UN-Habitat) among several others.

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Aliko Dangote, how a USD500,000 loan built a USD20Billion net worth June 2022

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Dangote was born in Kano, Kano State into a wealthy Hausa Muslim family. Dangote’s mother, Mariya Sanusi Dantata, was the daughter of businessman Sanusi Dantata.

Aliko Dangote’s father, Mohammed Dangote, was a business associate of Sanusi Dantata. Through his mother, Dangote is the great-grandson of Alhassan Dantata. The richest West African at the time of his death in 1955.

Dangote was educated at the Sheikh Ali Kumasi Madrasa, followed by Capital High School, Kano. In 1978, he graduated from the Government College, Birnin Kudu.

University Education and Entry into Business

He received a bachelor’s degree in business studies and administration from Al-Azhar University, Cairo.

The Dangote Group was established as a small trading firm in 1977. The same year Dangote relocated to Lagos to expand the company.

Dangote received a $500,000 loan from his uncle, to begin trading in commodities including bagged cement. As well as agricultural goods like rice and sugar.

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Dealings with the Central Bank of Nigeria

In the 1990s, he approached the Central Bank of Nigeria, with the idea that it would be cheaper for the bank to allow his transport company to manage their fleet of staff buses.

A proposal that was also approved. Today, the Dangote Group is one of the largest conglomerates in Africa.

With international operations in Benin, Ghana, Zambia and Togo. The Dangote Group has moved from being a trading company to be the largest industrial group in Nigeria.

Conglomerates in Dangote Group

It encompasses divisions like Dangote Sugar Refinery, Dangote Cement, and Dangote Flour. Dangote Group dominates the sugar market in Nigeria.

Its refinery business is the main supplier (70 percent of the market) to the country’s soft drink companies, breweries and confectioners.

The company employs more than 11,000 people in West Africa. In July 2012, Dangote approached the Nigerian Ports Authority to lease an abandoned piece of land at the Apapa Port, which was approved.

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Largest Sugar Refinery in Africa

He later built facilities for his sugar company there. It is the largest refinery in Africa and the third largest in the world, producing 800,000 tonnes of sugar annually.

The Dangote Group owns salt factories and flour mills and is a major importer of rice, fish, pasta, cement, and fertilizer.

The company exports cotton, cashew nuts, cocoa, sesame seeds, and ginger to several countries.

Other Major Investments

Additionally, it has major investments in real estate, banking, transport, textiles, oil, and gas. In February 2022, Dangote announced the completion of Peugeot assembling facility.

Which is in Nigeria and followed his partnership with Stellantis Group, the parent company of Peugeot, the Kano and Kaduna state government.

The new automobile company, Dangote Peugeot Automobiles Nigeria Limited (DPAN) factory, which is based in Kaduna, commenced operations with the roll-out of Peugeot 301, Peugeot 5008, 3008, 508 and Land Trek. “

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Networth

Dangote became Nigeria’s first billionaire in 2007. Dangote reportedly added $9.2 billion to his personal wealth in 2013, according to the Bloomberg Billionaires Index.

Making him the thirtieth-richest person in the world at the time, and the richest person in Africa. In 2015, the HSBC leaks revealed that Dangote was a HSBC client.

And that he had assets in a tax haven in the British Virgin Islands. As of June 2022, Dangote is the wealthiest person in Africa, with an estimated net worth of US$20 billion.

Read more at https://thebigissue.co.ke

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