Cars price will not decrease in Algeria

date 2017/08/10 views 1670 comments 0

icon-writer By: A. H. / English version: M. A.

Business Monitor International (BMI) showed optimism over car sales in Algeria by the end of 2017. It forecasts just 3 .0 percent growth after a series of declines in the last three years. A total of 90,000 cars only were sold during this period.

In its latest report, BMI said low sales growth was caused by tough import restrictions, rising inflation and a weak dinar.

It expects that the Algerian cars market with experience a remarkable increase as many foreign car makers started their work.

The report concluded that it does not “see the Algerian new vehicle sales market returning to its 2012 high (of over 450,000 units sold) any time soon.”

BMI’s forecasts reflect the Algerian industry state in terms of cars assembly. There have been slow attempts to go from complete importing to national production for three years.

The government has not adopted a clear policy and final laws to organize the sector for more than 40 months. It relied on it to reduce imports bill which consumed $6 billion of hard currency reserves in 2012.

Algeria wanted to create thousands of new jobs and encourage sub-contractors before starting exporting progressively. Yet, the challenge still faces the lack of financial resources and the non-readiness of national operators to develop the sector. 

This situation raised a large controversy among economic observers and public opinion. Because of that, doubts are still surrounding this issue. 

An “investigation commission” was assigned by former Prime Minister to find out the real reasons behind the problem. The new industry minister Mahdjoub Bedda described the situation as “masked importing.” The government froze all the new projects which are under examination until new specifications are done.

BMI’s report reflected a fierce competition with Morocco which was given priority by France.

The report expects that Morocco would be the first cars seller in North Africa by 2020 with a total of 250,000 units followed by Egypt with 170,000 cars. Algeria remains in the third position with a total of 100,000 sold cars.


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