What you need to know:
- Whereas some companies have concluded negotiations to take over some brands, others are still in discussions
Regional motor vehicle distributor - Cooper Motor Corporation (CMC) - has exited exclusive distribution of Ford, Mazda, and Suzuki, creating a mad rush for some of the brands it has been distributing.
People familiar with the matter have told Monitor that a number of motor vehicle dealerships, among which include Spear Motors, CFAO, formerly Toyota and CAETANO, which is represented by Motor Care, have either completed or are still in negotiations to take over some of the brands CMC has exited.
For instance, sources that asked to remain anonymous because they are not authorised to speak about the matter, noted that CFAO, which has previously co-distributed Suzuki with CMC, will now take exclusive charge, while Motor Care will take charge of Ford.
Spear Motors, Monitor understand, is still in negotiations to take charge of Mazda.
However, asked about the matter early this week, Mr Gilbert Wavamunno, the Spear Motors general manager, declined to comment.
Mr Edwin Muhumuza, the CFAO country sales manager, confirmed yesterday that they had effective July 1 taken over exclusive distribution of Suzuki.
“As such, after sales support to existing Suzuki customers will be managed through CFAO,” he said.
In a notice recently, CMC indicated it would exit sale of personal vehicles due to a major shift in business strategy, which would refocus the company’s growth efforts towards agriculture mechanisation solutions.
The change in strategy, CMC said, had been informed by the need to support government to sustain the growth momentum in the transformation of agriculture, noting that focus would now be put on exclusive distribution of New Holland, a tractor series with an extensive range of farming implements.
Mr Sakib Eltaff, the CMC Group managing director, said in a notice: “Agriculture has been going from strength to strength in the past few years and the demand for agriculture solutions is now stronger than ever.”
Therefore, he added, the shift will focus on offering agricultural customers access to mechanisation solutions and play a role in ensuring that Uganda continues to make progress in the quest for food security.
Uganda is largely an agro-based economy with at least 68 percent of the population working in the agricultural sector, which contributes 24 percent of the country’s Gross Domestic Product and 33 percent of export earnings.
CMC also indicated it was in the final stages of setting up a tractor assembly facility in collaboration with CNH Industrial, the manufacturers of New Holland tractors and Ministry of Agriculture.
The move will see CMC move away from the mass-market passenger vehicle segment to focus on strengthening its presence in the tractor markets cross East Africa.
Government has been pushing for mechanisation of agriculture with the view of reducing substance farming as well as increase the country’s value preposition from the sector.
The decision by CMC to exit the passenger vehicles segment has, however, created an opportunity for other dealers to expand their portfolios at a time when the country is experiencing reduced sales among new motor vehicle brands.