Dar es Salaam’s car business a blessing or curse?

Dar es Salaam’s car business a blessing or curse?

Saturday, 21 January 2012 12:04 Kenan Kalagho

DAR ES SALAAM, TANZANIA - Of recent, Dar es Salaam city has been dotted with car showrooms where reconditioned vehicles, mostly Japanese, are sold.

(Vehicles at one of the showrooms in Dar es salaam Photo By Kenan Kalagho)
The prices are far lower than new cars imports. Hundreds of these showrooms are seen within and on the outskirts of Dar es Salaam City where old structures have been pulled down.Forexample Ali Hassan Mwinyi Rd in Kinondoni area of the City, along Morogoro Rd and Kilwa road, among others.
Most of the car imports are brought in from Dubai, Japan and China where it is believed the prices of reconditioned vehicles are relatively low.
My previous employer, Jafarai Michael said, bought his reconditioned Toyota Rav4 model at only US$$8,300 directly from Dubai. With Customs clearing at Dar es Salaam Port, the final cost was $12,300. The difference in price for similar models being offered at City showrooms is a hefty $22,000.
It is estimated that around 50,000 imported vehicles pass through the Dar es Salaam every week and almost a quarter of such vehicles end up in Dar showrooms while others are being transported to the land locked neighboring countries of Zambia, Zimbabwe, Malawi, the Democratic Republic of Congo and other countries.
An economist with the Confederation Trade of Industries (CTI), Hussein Kamote, says that the cars in Dar es Salaam city means that the economic poison of individual Tanzanians is improving and that there is a demand for vehicles in the country.

(Traffic jam at one of the streets in Dar es salaam, the importation of used vehicles has resulted into traffic jam in most of African cities Photo By Kenan Kalagho)
He noted that a lot of companies offer their employees car loans a facility that encourages imports.
It is no wonder that one will see the dotted cars showrooms at several locations such along the Ali Hassan Mwinyi Rd in Kinondoni area of the City, along Morogoro Rd and Kilwa road, among others, spotting signposts reading: "Japan used vehicles sold here".
In these showrooms different models of vehicles are sold from Toyota, Nissan, and Mazda are showcased selling at prices sellers will bargain for.
However, Kamote cautioned that the influx of such used cars could be unwanted types in the countries of manufacture - in other words cars that could sooner or later become scrap.
"You will realize that many of these vehicles are 'used vehicles' and in such manufacturing countries there are almost at every time "new brands" that flood their local markets making it necessary for owners of older models to keep aged vehicles.
"You will realize that in the past there was a lot of congestion at the Dar es salaam port that that took up space for other imports. Some businessmen turned the port into their sales yards, not any more,' he noted.
Of course most showrooms in Dar City are in bonded warehousing facilities controlled by the Tanzania Revenue Authority. The vehicles in these facilities must be fully paid Customs duties to TRA before being released to buyers.
A Toyota Mark II will cost a buyer between $13,000 and $16,000, whereas a Toyota Rav4 goes for $22,000 at the show room - which is far more expensive compared than direct imports to individuals.
The influx of cars in Dar city, a city already bogged down jam, is certainly not a blessing to commuters.  "I use almost two hours every day going to work from Makumbusho area to Dar  City centre - "Ms Fatuma Mboga complained.