The market for new cars in Ghana has slackened as a result of the current economic downturn.
However the circa 20,000 used car market online is clocking top-gear growth. In the first half of this year alone, sales of used cars online grew by 15% compared to the same period last year.
What is more, the used car market now attracts a younger customer base as first time car buyers now move to online market places like Tonaton.com in search of better bargains.(Source: Tonaton.com)
“The average age of the used car buyer is now pretty low with people as young as 25 to 29 years opting for used cars in cities like Accra, Tema, Kumasi and Takoradi” says Kwabena Opoku-Boakye, Marketing Manager of Tonaton.com.
Part of the reason for that younger demographic has to do with the growth in online as a medium for buying and selling of used cars.
“The younger generation tend to spend more time online and the emergence of credible online trading platforms like Tonaton.com has eased the pressure on people who previously had to rely on family and friends or drive long distances looking for their first car to buy. People have also found an easier way of trading off their old cars in order to buy new ones,” he added.
The rush of younger customers to buy also explains why the used car market is experiencing such levels of patronage in the face of the general economic downturn in Ghana.
As more people go online in search of better bargains, the volume of business has also increased for individuals and garages that put up their cars for sale online.
George Dwomoh is the Managing Director of De-Georgia Motors at Tesano in Accra. He remarks that “Around 60% of the customers who visit my garage to buy cars now come through Tonaton.com. And majority of these people are youngsters who are looking forward to owning their first car”.
The Managing Director of K&K Motors, Michael Toku, has a wide range of new cars in addition to used cars in his garage and he agrees.
“We have witnessed about 10% decline in the sale of new cars but the used car business has been phenomenal this year”. K&K Motors has sold a whopping 80 used vehicles in the first half of 2014 alone.
“Typically the trend is that used car brands like Toyota and Nissan from the US and Korean cars like Kia and Hyundai are the most patronized by first-time car buyers who are mostly young corporate executives,” he adds.
In spite of the falling value of the cedi, the average price of a used 2010 Toyota Corolla on Tonaton.com for instance is GHc 22,500 compared to a price of GHc25,000 on the streets of Accra. The average price of a brand new Toyota Corolla will cost a potential buyer a whopping $22,700.00 (GHc68,100.00 if the exchange rate is pegged at 3.1). A Hyundai Elantra, which is highly patronized by the young and upwardly mobile Ghanaian sells at an average price of GHc23, 000 on Tonaton.com compared to GHc26,000 on the streets of Accra.
