The value of the US dollar against the local currency fell by 6%, recording EGP 16.60 per dollar, which resulted in a decline in the prices of some products, especially cars.
The US dollar decline gave some people hope to get a new car at an appropriate price, but the car prices announced recently by different car companies faded away, especially as the prices fell by EGP 5,000 – 30,000.
Therefore, consumers resorted to the used car market with hopes to find good alternatives, but this was not also available, as the cars owners decided to keep their cars until they can sell at higher prices.
Ibrahim Saeed, executive director of the used car market in Nasr City, said that the market has recovered two weeks ago, as trading volume increased by 60% compared to the period coinciding “Let it Rust” boycotting campaign, which contributed to a significant recession in the car market.
He added that car traders are the main problem facing the used car market, as the traders put a high profit margin, noting that cars sold by individuals are 15% cheaper than those sold by traders, however, the condition of the car determines its price.
Saeed explained that the impact of the US dollar decline on the prices of used cars will not appear now, because the prices of new cars did not decrease to the extent that allows the used car prices to fall. Regardless, he stressed that it is wrong to link the prices of new cars to those of used ones.
He added that the prices of used cars decreased relatively as a result of the recession experienced in the market, not because of the decline in dollar value, noting that the price of gasoline, if increased, will not impact the prices of cars because the car has become essential now.
On the contrary, Mohamed Bilal, a trader in the used car market, said that the market is still suffering from a slow trading movement, especially after the holy month of Ramadan and the Eid Al-Fitr, revealing that the activity of used cars trading does not exceed 5% now.
He added that the prices of cars in the used car market fell somewhat, affected by the decline in the value of the dollar in the past period, where the price of Hyundai Tucson went down by 25%, and the Kia Sportage price was down 15%. However, this had no major impact on car trading because those who want to buy a new car wait for further price decline, and car owners worry about possible lose if they sold their cars now.
Bilal said he used to sell three cars daily, but now he sold this number over six months. He noted that the profit margin of the trader is not fixed, as it can be EGP 1,000 in a car and EGP 5,000 in another.
In the same context, Ahmed Essa, a dealer in the used car market, said that the used market is still impacted by the recession that hit the new car market due to high prices. Essa explained that sales decreased significantly compared to the same period last year. The selling rate was two cars per week and has become two cars per month, though, it is even better than the beginning of the year.
Essa also said that the decline in the value of the US dollar to EGP 16.6 did not affect the used car market. He noted that the decline in the prices of new cars did not satisfy consumers, so the situation came to a standstill.
He stressed that the number of vehicles offered for sale in the used car market has significantly fallen, to the extent that the number of offered cars on Friday – the peak day of selling used cars – is now less than the number of those offered on Sunday, the other working day in the used car market.