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Nam imports N$7.2b worth of cars in a year

Fri, 27 May 2016 15:56
by Rodney Pienaar
News Flash

Namibia imported 17 000 vehicles in the last financial year, to the tune of N$7.2b, despite calls by the central bank to cut down on luxury expenditure at the expense of improving local production.
Currently Namibia does not have any restrictions on the number of automobiles to be imported, although the Government Gazette No 253 of 23 September 2013 imposed restriction on the importation of second hand motor vehicles older than eight years.
According to Ministry of Finance, Commissioner of Customs and Excise, Bevan Simataa, Namibians who have intentions to import vehicles or other commodities are supposed to apply to the Ministry of Industrialisation, Trade and SME Development to ensure that the goods are compliant with the Import and Export Control Act.
“The public also needs to take note that there are restrictions, meaning a permit is required to import but when it is prohibited, for example vehicles older than eight years, then it means you are not permitted at all to import that specific commodity. Failure to obtain the right permits can have major legal and financial implications”, Simataa said.
In 2014, Namibians imported N$8 billion worth of vehicles. According to statistics availed by Customs 8 701 tractors; 8 702 buses and SUV; 8 703 vehicles with a capacity not exceeding 3500 GVM (gross vehicle mass) and 8704 vehicles with a capacity exceeding 3500  including double cabs were imported.
Last year, The Villager reported that aggregate revenue for vehicle sales dropped by 5.69% to N$5.98 billion during the month of October, compared to N$6.32b during September.
Revenue by each category declined in October, as compared to September’s revenue. Slow growth in household instalment credit reflects in the subdued growth in passenger vehicle sales.
The level of automobile purchases also comes at a time when the central bank Governor, Ipumbi Shiimi, raised the red flag over the country’s uncontrolled borrowing to finance non-essential commodities, including cars at the expense of financing projects that stimulate the economy, The Villager reported.
According to a 2014 South African report reflecting on vehicle sales in both imports and exports by the National Association of Automobile Manufacturers of South Africa (Naamsa), the import value of vehicles and automotive component imports under the Automotive Production Development Programme (APDP) in 2013 amounted to R126.7 billion compared to the export value of vehicles at R60.5 billion.
In 2013, 51 brands and 2 295 passenger car model derivatives were available in the domestic market. India with 95 964 units was the main country of origin for imported passenger cars and light commercial vehicles in 2013.
Imports from India mainly consisted of small cars including the Toyota Etios, Ford Figo, Nissan Micra and Hyundai i10. Imports of original equipment components used to manufacture the vehicles amounted to R59 billion and originated mainly from Germany, Japan and Thailand.
Capital intensive components such as engines, gear boxes and electronic components are mainly imported.
The Villager also reported that middle-aged Namibians have increased their appetite for mortgage credit (loans for home) which stood at N$37.5billion on average over first six months of this year.
According to Bank of Namibia, since the beginning of the year, instalment credit measured over the first six months stands at N$11.3 billion on average. This represents a share of 15.5% of total credit granted to the private sector which stands at N$72.7 billion.
While the desire to own a home seems to be getting for the better part of the year, car dealers such as Indongo Toyota and Jan Japan Motors said they have had good year with a spike in car sales.
Japanese second-hand car dealership Jan Japan has sold about 91 000 units in 2014 figures showed. Second-hand car dealerships have gained popularity since Government relaxed import requirements for cars a few years ago.
Commenting on the development last year, Namibian Chamber of Commerce and Industry (NCCI) Chief Executive Officer (CEO), Tara Shaanika said the automobile industry in the country is still a reservation for the few.
Shaanika told The Villager that, local players interested in this industry are not meeting the requirements for them to be able to freely import and sell cars locally. He also told The Villager that, the market is not conducive for new players especially those that are first timers because they are not protected by government policy. Shaanika said.