Are international car brands cutting Egypt out of their short-term export plans?
WATCH THIS SPACE- Are international car brands cutting Egypt out of short-term production plans in response to a slowdown in finance available for imports? Both Al Borsa and Al Mal are reporting that as many as eight international auto companies have stopped exporting cars to Egypt on the back of Egypt’s decision to move importers to letters of credit instead of the longstanding process of documentary collection to import goods. The combination of a very tight global car market and delays opening letters of credit (L/Cs) has seen manufacturers diverting shipments to other markets, the newspapers quote industry sources as saying. One dealer expects imports to decline “significantly” in the coming months.
We’re looking into the story and will be back tomorrow with more on what has so far been a less-than-wonderful week for the car industry. The Consumer Protection Agency ordered dealers to hand a full refund of down payments with 18% interest to customers who had placed since 12 April, and said that anyone who purchased a vehicle prior to 12 April would be protected from any subsequent price hikes. The CPA is also raising by 5% the cap on prices it introduced in March in the wake of the float of the EGP, despite the industry’s demands of around 10%.
That Consumer Protection Authority (CPA) ruling on down payments yesterday? It applies to all consumer goods. People who put down down payments on any consumer goods prior to 12 April will enjoy the same protections against higher prices, CPA chief Ayman Hossam El Din said on Al Hayah Al Youm last night (watch, runtime: 6:40). Retailers will be required to return down payments plus 18% interest to anyone who wants a refund, he said. The measures come following complaints by customers that sellers are hiking prices above the original price in response to rising inflation.
Why the 12 April date? That’s when the repercussions of the supply crisis really started to kick in, he said.