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Used cars being prepared for shipment to Africa at the premises of a Shipping Agent in Germany / Photo: Courtesy of StOmAz

Europe-based dealers alarmed as China begins export of used cars to Africa

Until now, used vehicles sold in most African countries are usually from Western Europe, United States and Japan. The announcement that China had joined the trade of supplying second-car cars to the continent is causing jitters among other exporters.

The news came unexpectedly two days ago. The Chinese Ministry of Commerce announced that it had commenced the export of used cars to Africa, Asia and Europe, with Nigeria as one of the major destinations for the first batch of 300 cars. The cars, comprising Land Rover, Toyota, Hyundai, Volkswagen, Trumpchi, King Long, Yutong, Zhongtong and WOHO brands, were already on their way to their foreign destinations including the Lagos port (Nigeria), the ministry said.

The move was geared towards deepening implementation of the Belt and Road Initiative (BRI) and promoting the stable growth of foreign trade, the ministry explained.

The BRI is a global development strategy which the Chinese government adopted, involving infrastructure development and investments in 152 countries in Africa, Asia, Europe the Middle East and the Americas.

Analysts say China has an estimated fleet of more than 300 million privately-registered vehicles, the largest in the world. It now wants to create an export market for its second-hand vehicles to stimulate demand for new ones. One of its potential markets is Africa where second-hand cars are very much in demand, because they’re much cheaper than brand new vehicles.

The new development would shake the international trade in used cars as the Chinese would most likely offer cheaper vehicles to Africa displacing the continent’s traditional suppliers in Europe and United States, says Vincent Ejikeme, a Frankfurt, Germany-based used vehicle exporter.

Traders in countries like Germany, Belgium and the Netherlands, who have been in the business for decades, will now have to compete with the Chinese. Knowing how the Chinese have been conquering markets of other products globally, Nigerian-born Ejikeme did not think the Europeans and other traditionally suppliers would be able to withstand the Chinese competition. “People don’t have money in Africa so if they see cheaper alternatives to the European used vehicles they would go for them,” he added.

Austin Ohaegbu

 

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