Feature: Boycott internet campaign causes stagnation in Egypt's cars market

Source: Xinhua| 2019-01-29 21:21:11|Editor: xuxin
Video PlayerClose

by Marwa Yahya

CAIRO, Jan. 29 (Xinhua) -- "We aims to see a 35-percent decline in car prices in Egypt by June," said Ahmed Abdel Moez, founder of a Facebook page for boycotting the purchase of cars due to hiking prices.

The page was launched in the beginning of January, aiming to control car prices and reduce financial burdens on customers, Moez said.

The Facebook campaign which is now followed by 650,000 users was launched after the Egyptian Finance Ministry announced on Jan. 1, 2019 that it would lift tariffs on cars imported from the European Union.

Amid high expectations of decreasing the car prices, we felt frustrated that it did not come true, Moez said.

The would-be buyers started the Facebook campaign in hope for binging prices back down, he added.

Comparing car prices in Egypt with those in the Europe, the gap was large, as car prices in the North African country are very high, he noted.

The Egyptian car market has undergone an overall surge of 30 percent in retail prices in the past two years.

Brands normally considered relatively cheap, such as Hyundi, Kia and Chevrolet, have become suddenly unaffordable for many.

For example, the Hyundai Verna jumped from 80,000 Egyptian pounds in 2015 (about 4,535 U.S. dollars) to 119,000 pounds in 2016, and the Kia Picanto from 85,000 pounds (4,820 dollars) in 2014, to 145,000 pounds (8,223 dollars).

Moez said the prices have rocketed over the last three years due to the pound devaluation in 2016, and car dealers sought to increase their margins.

The merchants attributed the high prices to the costs of the production and employment. But Moez explained despite those costs are higher in Germany, the car prices are still much cheaper than in Egypt.

"We don't seek hindering the national economy. We only want fair prices and combat the greedy traders," he added.

Independent TV channels on Monday have spotted the accumulation of new cars on the coastal port of Alexandria city which normally receives 70 percent of the imported cars.

The boycott campaign has greatly impacted the car market in Egypt which created a problem for finding parks to contain the large numbers of imported cars, said an official at Alexandrian port on conditions of anonymity.

The stagnation in the car sales has pushed the importers to hide those cars in remote desert areas, he added.

Raafat Masroga, honorary head of the Cars Market Information Council, said the car sales have declined by 50 to 60 percent in the past few days.

Osama Mohamed, sales manager in Automotive Car Shop, highlighted zero sales in his shop in January.

He believes the internet boycotting campaign is "a waste of time" because it couldn't continue forever, and the citizens would be forced to buy.

He added the campaign causes harm to the Egyptian economy because the sales produce revenues for the country.

He reiterated that most of the profits went to the importer, but the car shops only earn 2,000 pounds for selling one car.

Meanwhile, Nour Darwish, deputy manager of the car branch department in the Trade Union, said the ongoing perplexity in the market has nothing to do with the boycotting campaign.

He said that the difference in the old and new cars that are produced abroad and collected domestically as well as the problem of re-pricing them are the main reasons for the car stagnation.

He named the online campaign "a black point in the forehead of the Egyptian economy."

He stressed that the recent decline in the car prices was due to the EU agreement and not the decision of the agents or the distributers.

Darwish expected that the car prices would not decline in the coming period.