German automaker Porsche AG has announced plans to transfer the Porsche car dealership from the current dealership to a new dealership or one of the existing ones in the local market.
The current dealership, Porsche Center Nairobi, will continue to sell parts and services to customers until March 2021.
Porsche Center Nairobi is among the other luxury car dealerships in Kenya including; DT Dobie – Mercedes Benz, Inchcape Kenya – Jaguar, BMW and Land Rover and Bentley Nairobi – Bentley. Bentley Nairobi and Porsche Center Nairobi have common ownership through their parent company, Multiple Hauliers.
The dealership was well received when it opened in May 2014, with sales of 125 units in the first eight months. The strong initial sales were linked to a huge demand for sports cars among wealthy individuals who could now benefit from access to parts and service from a local dealership.
The reason for the dealership contract termination was not disclosed, but sales of luxury sports cars in Nairobi have declined in recent years. Orders for the models, led by the popular Cayenne sport utility vehicle (SUV), totaled 102 units in 2015 and fell to 54 units the following year.
The outgoing dealership had sold 420 cars in total by November 2020, according to data from the Kenya Motor Vehicle Industry Association (KMIA). With showroom prices of Porsche cars ranging from Ksh. 10 million to Ksh. 28 million, this translates into sales of at least Ksh. 5 billion over the past seven years.
A mix of internal and external factors, including car stockouts, higher taxes and tighter lending standards by banks, are believed to have contributed to the dealer’s lower sales in recent years.
Porsche’s move marks the trend seen in the new vehicle market in Kenya, where automakers are constantly reviewing their existing franchises in the country. For example, DT Dobie took over the Volkswagen dealership from CMC, DT Dobie lost the Nissan franchise to Crown Motors, and General Motors ended the sale of Chevrolet cars by Isuzu East Africa.