Tanzania Autos Report Q2 2012
Business Monitor International, February 2012, Pages: 32
Tanzania Autos Report provides industry professionals and strategists, corporate analysts, auto associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Tanzania's automotive industry.
The small size of its new car market and limited growth potential has put Tanzania in 16th position in BMI's newly compiled Risk/Reward Ratings for the autos industry in Africa this quarter - slightly ahead of Sudan. Although the economy grew a robust 6.4% year-on-year in real terms in Q311, following an already impressive 6.7% y-o-y growth in 2010 (according to the National Statistics Bureau), much of this growth has been attributed to strong performances in the mining, agriculture, transport and communications sectors.
For a substantial majority of private consumers, new vehicles remain unaffordable, making used cars the most accessible route to car ownership. As such, we believe that much of the growth in new vehicle sales over the coming years is likely to come from companies and government departments. Despite these demand-side constraints, BMI sees significant scope for Tanzania to move up in the ratings systems in the medium and longer term. The country is gradually emerging as a popular entry point for international players. In January 2012, Indian manufacturer Hero Honda revealed its plans to assemble and sell motorcycles in Tanzania, in line with its broader regional strategy of targeting the rural population. Company representatives have revealed that Honda has manufactured a new CB125 model targeted specifically at African markets and will be looking to directly compete with Chinese brands in the segment. For that, it plans to partner with locally based Quality Motors Limited and hopes to benefit from the latter's local expertise.
The project follows similar commitments made by compatriots TVS Motors and Bajaj Auto, which kick-started their assembly plants in the country in March and December 2011 respectively. The key attraction of Tanzania for these companies is not only an unsaturated vehicle market but also its membership of the East African Community (EAC) common market. Formed in July 2010, the EAC allows duty-free trade between member states - Burundi, Kenya, Rwanda, Tanzania and Uganda. Also, the Dar es Salaam port is becoming increasingly popular among importers of cars from Asia and the Middle East.
However, in terms of the competitive landscape, Japanese vehicles dominate the new vehicles market, with Toyota Motor the most popular.
Executive Summary
SWOT Analysis
Tanzania Political SWOTs
Tanzania Economic SWOTs
Tanzania Business Environment SWOTs
Global Overview
Eurozone And EMs Pose Risks To 2012 Growth Outlook; US And Japan On The Rise
Table: Passenger Car Sales (Units), Jan-December 2011
Replacement Growth?
Business Environment Ratings
South Africa Leads New BMI Ratings
Table: Sub-Saharan Africa Autos Risk/Reward Ratings
Regional Overview
BMI Highlights Its Favourite Opportunities In Sub-Saharan Africa
Macroeconomic Forecast Scenario
Table: Tanzania - Economic Activity, 2011-2016
Industry Forecast Scenario
Table: Tanzania Automotives Historical Data & Forecasts
Competitive Landscape
Company Monitor
JLR Investment Targets Increased Buying Power
BMI Methodology
How We Generate Our Industry Forecasts
Automobile Industry
Sources
- JLR
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