Automobile Industry: Ghana adjudged the most attractive market in West Africa; 5th in SSA

Automobile Industry: Ghana adjudged the most attractive market in West Africa; 5th in SSA

The Autos Sales Risk/Reward Index by Fitch Solutions, has ranked Ghana as the most attractive automobile market in the West Africa sub region.

The Index report further ranks Ghana as the fifth most attractive automobile market in the Sub-Saharan Africa (SSA) region.

Despite having a score below 40 percent – 32.3 percent – the research agency, notes that the score is enough to make the country the most attractive automobile market in West Africa.

“Ghana has moved to the 5^th position in the SSA region amid a better performance this quarter. A developing automotive sales environment amid a favourable political risk outlook enables policy certainty,” states the report.

The report further states that Ghana’s rapid economic growth resulting in an increase in incomes will lead to more people affording vehicles which will, in turn, drive demand over the long term.

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However, it adds that the country will continue to suffer from high borrowing costs which impede the development of vehicle finance, and hence new vehicle sales.

Fitch Solutions in the report expressed worry about Ghana’s underdeveloped road infrastructure which remains an impediment as the country scored 17.7% under its ‘quality and extent of transport network’ indicator, underperforming the Sub Saharan Africa region’s average score of 22.1%.

“Ghana’s low levels of vehicle ownership rates highlighted by a score of 11.3% under our ‘vehicle ownership per 1,000 inhabitants’ indicator signals further room for vehicle sales growth going forward as rising incomes lead to first-time buyers entering the market for vehicles. Furthermore, an age limit on imported vehicles permitted into the country will develop a local new vehicle sales market going forward as the flow of used vehicle imports slows to the benefit of newer vehicles,” noted the research agency.

According to the report, the Sub-Saharan Africa region continues to underperform the global average amid significant risks still present in the area.

Also, the county’s low levels of vehicle ownership rates signal further room for vehicle sales growth going forward. Meanwhile, South Africa placed 1st with a score of 52.4%, whilst Mauritius and Botswana were 2nd and 3rd respectively.