Africa Used. Vehicle Report. Ariadne Baskin. African Clean Mobility Week March

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1 Africa Used Vehicle Report Ariadne Baskin African Clean Mobility Week March

2 Content Africa Used Vehicles Report Regulatory Environment Supply Chain & Scale of Used Vehicle Flows Way forward 2

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4 ? Data availability (disaggregated country used vehicle statistics)? Discrepancies in trade statistics? Variability of car ownership data in Africa In 2014, Sub- Saharan Africa recorded 2% of vehicle ownership per capita compared with 70% in the United States, 50% in Europe, and 6% in China (OECD/IEA, 2014).? Fluidity of many nations borders & grey maket

5 How can we ensure that used vehicles are the solution to clean mobility rather than exacerbating the current problem? ENSURING BETTER AIR QUALITY AND REDUCED CLIMATE EMISSIONS THROUGH CLEANER USED VEHICLES UN Environment & UN Economic Commission for Europe (20-24 Feb 2017, Geneva Switzerland Partnership for Clean Fuel and Vehicles - Used Vehicle Working Group Global Status of Used Vehicles Report & Database Africa Report on Used Vehicles

6 Global Status of Used Vehicles Report A global report and database on what different countries and regions are doing, or not doing, to grapple with the issue of used vehicles? What policies are preferred? What policies are helping leapfrog markets to cleaner and safer mobility? Understand the global and regional supply chains, scales and quality of used vehicle flows What are the current trends in global and regional trade? Understand the implications of used vehicle flows both for local pollutants, health and global emissions There are currently no regional or global agreements that rationalize and govern the flow of used vehicles

7 Q: How can used vehicles leapfrog Africa to much cleaner and more energy efficient vehicle technology and fleets? What is the business as usual (BAU) scenario? What are the regional supply chains? How do countries fit into the regional supply chains? What are the vehicles origins? How many used vehicles and of what quality? New vs. used vehicle age and model level detail? What is the countries used vehicle regulatory framework? Does the country incentivize, offer tax breaks for clean technology (Ev s) It is essential that the supply chain, scale and quality of used vehicles into and within Africa be understood.

8 Snapshot of Used Vehicles in Africa 42,510,000 vehicle in use in Africa ( OICA 2014) Used vehicle market has been estimated at about $60-70 billion in sales worldwide Annual vehicle fleet growth rate in Kenya and Ethiopia is 12% and 10% respectively In Ethiopia and Nigeria used vehicle imports account for 80% of all vehicle sales( 2016) More than 96% of vehicles imported into Kenya are used (2016) 1:131 ratio of new cars to used in Nigeria (2017) Africa imports 4 x more automotive products than it exports In 2014, automotive imports valued $48 billion and exports totaled $11 billion. In Nigeria internet bases car sales account for 89% of all car sales (2015)

9 Regulatory Environment

10 Status of Used Vehicles Only Egypt, South Africa, Sudan, and Morocco impose a total ban on used vehicle imports. Strong 10 countries ban used vehicles over 5 years and/or have strong tax, fee bate schemes; Fair 16 countries allows vehicles between 6-9years and/or the country imposes an incremental tax, up to 9 years, on vehicles based on age; Weak 24 countries ban used vehicles 10 years and over; impose a graduated penalty from 10 years and/or have no regulations in place.

11 25 countries place a maximum age limit on imports 4 countries completely ban imports 10 countries ban imports over 5 6 countries ban imports over 10 years old.

12 Age Restrictions of LDV Used Vehicle Imports, January 2018

13 Mauritius Leapfrogging to Clean Technology Adopted a carbon feebate scheme in 2011 at 158 CO2g/km Scheme resulted to an improvement of fuel economy from 7l/100km in 2005 to 5.8l/100km in % excise duty waived on electric and hybrid cars and Registration fee also reduced by 50% From 2009 to 2014, the number of hybrid and electric cars has increased from 43 to 1824 and from 0 to 8 respectively 2016 feebate abolished and moved to taxation system with additional incentives to electric vehicles The majority of used vehicles are from Japan- 49% (2016) 3 year age limit There are plenty of opportunities to incentivise the purchase of used Ev s and clean technology through tax breaks

14 Uganda- Average LDV Fuel Economy liters per 100km ~10% decrease

15 Range of Vehicle Regulations Angola Automobile companies are not allowed to import used vehicles only individuals; 3 year age restriction Botswana Maximum of 100,000 kms Cote d Ivore A fine of is imposed on vehicles older than 10 years and an additional for every year Ghana Used vehicles over five years old pay a graduated penalty according to year of manufacture and capacity Mauritius- 3 year age restriction; C02 based taxation Niger- Used vehicles from outside of the SACU must be less than 5 years. However, there is no age limit for SACU-originating used vehicles Nigeria 15 year age restriction; Euro 2 South Africa Banned all used vehicle imports

16 Regulations on Vehicle Imports

17 Understanding the Supply Chain & Scale of Used Vehicle Flows

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20 In 2013, around 800,000 used cars were headed to the top ten sub-saharan African importers from Japan, EU and US Top 10 sub- Saharan African importers of used passenger vehicles from the US, Japan and EU in 2013 Eurostat Comext Database, Japanese Customs and Tariff Bureau, and U.S. International Trade Commission

21 Regional share of total passenger vehicle imports (new and used) from the US, Japan and EU in 2013 Each region has developed their own networks of supply and demand. West Africa dominates the used vehicle market, with the Nigerian market (400,124 total imports) accounting for over double the vehicle imports to the entirety of East Africa (172,772). Central African imports equate roughly to Kenya s (62, 751); with over half the imports stemming from Cameroon (30,662).

22 West Africa Regional Supply Chain

23 The majority of EU and U.S used vehicle exports, over 85% and 95% respectively in 2013, were destined for West Africa. Germany is responsible for over half of EU export, accounting for 53% in 2016 (Eurostat, 2016). Used passenger vehicles from the US

24 Japanese used car exports dominate the South and East African Markets. Six nations account for 81.1% of Japanese used vehicle trade. Kenya is the major market followed by South Africa, Tanzania, Uganda, Zambia and Mozambique. Used vehicles imported into South Africa are for re-export, as there is a ban on used vehicles Used Passenger vehicles from Japan

25 Key messages Not restricting but shifting to cleaner and safer used vehicle imports Ensure used vehicles contribute to better road safety, reduced emissions, and provide cost savings; Direct correlation between basic import restrictions and a less outdated and more clean and technologically advanced fleet -> Mauritius vs. Uganda Need for data availability and collection Need for harmonization at regional and sub-regional level; Need for a systems approach; Need to address the illegal practices in the export of used vehicles; Raise awareness, show policy options and promote harmonized interventions;

26 WE NEED YOUR HELP!

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