The Association of Car Importers in Lebanon (denoted as AIA) recently stated in its automotive report that “As a result of the dramatic Beirut Port Explosion on 4/8/2020 and due to the Covid-19 lockdown, the damages that importers of new cars incurred in their properties are estimated at tens of Millions of Dollars. This will lead to the closing down of a number of companies and to the licensing of a large number of their employees and workers”.
More generally, the market has been facing increasing challenges in the last two years mainly resulting from a severe reduction in purchasing power of customers as well as ceasing loans from the Lebanese banks. As a result, passenger cars dropped by 47.60% yearly to 2,422 by July 2021.
In details, by July 2021, Japanese Cars took the highest share of 44.04% of Total cars; with Suzuki and Toyota recording 19.94% and 13.74%. Second, Korean cars accounted for 25.64% with KIA owning Lion’s share of 50% among them. Moreover, European cars came third, measuring 21.50% of the total.
We might not expect a rebound in this sector in the near future, even if the economic situation gets better, since the Lebanese behavior has changed amid this severe financial crisis, as they have become more cautious about their spending habits.
Growth of Registered Passengers Cars by July 2021