Zaghdar: Car prices will decline in the Algerian market

The Minister of Industry, Ahmed Zagdar, said that car prices will decline in the Algerian market with the start of manufacturing and importing vehicles, which will lead to an abundance of supply, especially through controlling costs and profit margins that will be studied.
He pointed out that “with regard to the vehicles that will enter the market, we expect a decline in their prices, due to several factors, including the large increase in vehicle prices in the past years in light of the lack of supply in the market, which resulted in a lack of supply compared to demand in addition to speculation. But with the return of supplying the market through import and local manufacturing, prices will certainly decline.”

The minister explained that in the absence of supplies during the recent period, and in order to correct the situation that resulted from a previous experience in the field of car manufacturing, the state worked to resurrect a “real mechanical industry”, by establishing a dynamism for the existing handling institutions, while opening the door to import and expediting supply to the market. At the lowest possible cost and with the greatest possible economic benefit.

He stressed that the vehicles that will be imported or installed “are mostly directed at a wide segment such as middle-income people, which means that their cost and profit margins will be studied by the factory,” in addition to “the competition factor will also play a role in reducing prices.”

“We expect prices to be at the same level as prices in the rest of the world,” he said.

And on a question as to whether the cars that will be manufactured locally will benefit from bank loans, the minister stated that consumption loans are open exclusively to national production, according to the laws and regulations in force, and therefore locally produced vehicles “are eligible for consumer loans unlike vehicles that are imported.” .

Regarding the two regulatory texts related to the activity of importing new vehicles and the activity of manufacturing vehicles (Executive Decrees No. 22-383 and 22-384 of November 17, 2022), which were issued recently, he explained that they fall within the framework of applying a new approach that avoids the mistakes of the old approach that made this activity The biggest drain on exchange reserves without reaching the set goals.

He added, “Among the points included in the new regulatory framework is the imposition of conditions on manufacturers of tourist vehicles and light commercial vehicles interested in investing in Algeria, especially with regard to integration and reliance on local handling, as 30 percent has been determined as a minimum percentage for integration by the fifth year from the date of obtaining the accreditation.” .

“As for manufacturers wishing to benefit from the advantages granted within the framework of the free trade agreements signed by Algeria, they must achieve an integration rate of 40 percent,” he added.