Prices of home-used vehicles go up by 25% within a year

• Posted on February 18, 2016
• by Nana Kwesi Coomson
• Comment

PRICES of home-used vehicles in Ghana have within a year gone up by over 25 percent,Business Finder can confirm.

The development is due to unfavourable exchange rate regime and increases in taxes among other factors at the country’s ports.

The recent introduction of the ECOWAS Regional Common External Tariff (CET) is expected to shoot up the prices of vehicles further.

Vehicle importers who in the past paid as low as 5 percent import duty for all types of vehicles are now paying as much as 20 per cent.

A careful analysis of prices of home-used vehicles on popular website,’ tonaton.com’ andbusinessghana.com revealed that prices of most popular vehicles used in Ghana, Toyota, Kia, Hyundai and Nissan have gone up quite significantly.

For instance,a Toyota Corolla S 2011 model which previously sold at GH¢43,000 a year ago is now selling at GH¢55,555 while a Hyundai Elantra 2012 model which went for GH¢35,000 a year ago now sells at GH¢45,000.

Those of Chevrolet Cruz 2012 model and Kia Cerato 2011 model which used to go for GH¢38,000 and GH¢28,000 a year ago are now trading at GH¢47,000 and GH¢4000 respectively.

A car dealer, Isaac Boamah, who used to import about 10 slightly used vehicles every three monthssays he can now import only three vehicles.

“It is now difficult to bring in vehicles. Because of the instability of the dollar and the new ECOWAS tariff I cannot tell how much I will pay for clearing vehicles. Even when you get the cars out of the port it takes a very long time before you can sell.”

Some car dealers this paper interacted with at Tesano and Abeka agreed with MrBoamah, saying, these days it takes a very long time to even sell one vehicle.

“Due to price increases, many potential car owners cannot afford to buy a home-used car”, Isaac Ansah, another car dealer told the Business Finder.

He added that the least price of a slightly used car which is even 10 years old is about GH¢22,000.

The dealers also indicated that they are making huge losses since  they are unable to recoup their monies spent on purchasing the vehicles abroad and clearing at the country’s ports.

At some garages at Caprice and Dzorwulu in Accra,there is a spillover of vehicles on sale onto the pavements and pedestrian walkways as“people were not buying.”

Vehicles such as Honda Accord, Mercedes Benz and BMW are even far more expensive.

The situation is also worse for brand-new dealers as demand for these vehicles have gone down because of the challenges in the Ghanaian economy.

Toyota Ghana which used to sell close to 400 vehicles a month is now selling a little above 100 vehicles while Hyundai Investments which was selling more than 200 vehicles a month sells only about 80 vehicles.

A visibly disturbed clearing agent, Frederick Yeboah told Business Finder that vehicles which used to cost GH¢14,000 in clearing are now going for about 17,000, representing about 21 percent increase.

Another agent, Issaka Mohammed also told this paper that the high clearing duty at the port is collapsing their businesses. “Imagine four or more years ago I could clear about 6 cars a day……Today I can only clear a maximum of two cars. Even at times you cannot clear a single car”, he lamented.

Executive Secretary of the Importers and Exporters Association, Sampson Asaki had told this paper that the new common external tariff will not only raise the cost of clearing goods but will also increase the many uncleared goods particularly vehicles at the ports.

The strength of the Cedi which is an important component in clearing vehicles at the port began the year at about GH¢3.82 to the US dollar but is now trading at over GH¢4.0 to the American currency.

By Augustine Amoah