Uganda among African countries with lowest car ownership rates
The car business in Uganda mainly depends on old cars imported from Japan. File photo
What you need to know:
- The study notes large disparities in car ownership across regions and demographic groups, with South Africa leading at 50 per cent.
- According to records from Uganda Revenue Authority, the number of motor vehicles registered declined by about 7.7 per cent from 40,993 in 2021-2022 to 37,856 in 2022-2023. Compared to 2020-2021, the registrations in 2022-2023 were roughly 5.9 per cent of the total registrations in that period.
A recent report by SAGACI Research, a marketing research and data analytics firm, has revealed that Uganda has one of the lowest car ownership rates in Africa, with only 13 per cent of the population possessing vehicles.
Despite this, Toyota and Mercedes-Benz remain the leading brands in Africa, according to the report.
The study also revealed that Toyota is the most preferred car brand in Africa, with a 78 per cent preference rate among those who have owned one.
Car ownership remains low across the continent, with fewer than 1 in 4 Africans (22 per cent) possessing a vehicle.
In Uganda, car ownership stands at under 13 per cent, similar to other East and West African countries such as Burkina Faso, Ethiopia, and Rwanda. The study notes large disparities in car ownership across regions and demographic groups, with South Africa leading at 50 per cent.
The study also shows that car ownership varies significantly by income bracket, with 45 per cent of respondents in the highest income bracket owning a car, compared to just 11 per cent among lower-income groups. Age also plays a significant role, with ownership rising from 17 per cent among 18-25-year-olds to 36 per cent for those aged 46 and above.
"The disparities in car ownership across Africa highlight both the growth opportunities and challenges in the region. Understanding these regional dynamics is key for companies looking to capture the expanding middle class across the continent," said the research firm’s managing director, Mr Julien Garcier.
The study's findings are based on data from Sagaci Research's SagaCube and SagaBrand databases, which track consumer behavior and brand performance across over 2,000 brands and over 150 product categories in Africa.
When this publication spoke with Mr Gilbert Wavamuno, the managing director of Spear Motors - a Mercedes-Benz dealing company in Uganda he said: "The most popular cars in Africa are indeed Toyota and Mercedes-Benz, with Toyota being budget-friendly and Mercedes offering luxury and quality."
On the low car ownership rates in Uganda, Mr Wavamuno attributed it to the second-hand market being the biggest market in the country.
"However, Mercedes and Toyota exist in both new and second-hand markets, and we have official service centres that provide peace of mind for customers," he added.
Mr Wavamuno also highlighted the importance of official service centers in supporting the popularity of these brands.
"People prefer to deal with official representatives for maintenance and repairs, which is why we have a strong network of service centres in the country," he said.
According to him, further research would be needed to understand the underlying factors contributing to low car ownership in Uganda.
"It's a complex issue, and there are many likely factors at play," he added.
The SAGACI Research report highlights the challenges faced by automakers in Uganda and the need for innovative solutions to increase car ownership rates in the country.
URA statistics
According to records from Uganda Revenue Authority, the number of motor vehicles registered declined by about 7.7 per cent from 40,993 in 2021-2022 to 37,856 in 2022-2023. Compared to 2020-2021, the registrations in 2022-2023 were roughly 5.9 per cent of the total registrations in that period.
The increase in vehicle prices due to global disruptions like COVID-19 and the Russia-Ukraine conflict, combined with Uganda's ban on importing vehicles older than 15 years, likely impacted vehicle registrations. Despite these challenges, Station Wagons remained popular, with an average of 23,353 units registered annually.
