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 44.32% yearly to 2,677 by August 2021.
In details, by August 2021, European Cars took the highest share of 32.55% of Total cars; with Renault and Mercedes recording 16.87% each. Second, Japanese cars accounted for 32.16% with Toyota owning Lion’s share of 47.56% among them. Moreover, Korean cars came third, measuring 16.86% 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. That is in addition to the severe recurring shortages in gasoline.
Growth of Registered Passengers Cars by August 2021