Do Nicaraguans no longer have to fear going into debt when purchasing a vehicle? Strong increase in imports

Following the global recovery trend, vehicle sales in Nicaragua recorded a 37 percent increase in 2023 over the total volume of imports of transportation equipment and its spare parts. Overseas purchases of trucks, minibuses and sedan-type cars increased the most; And in general, these purchases exceeded the amount allocated by about 200 million in 2017, that is, before the socio-political crisis that emerged in 2018, and whose impact was exacerbated by the paralysis of activities caused by the COVID-19 pandemic.

It is not clear whether the increase in billing of these items is due to the overall recovery of the vehicle delivery sector or due to the international inflation factor. The Central Bank of Nicaragua (BCN) does not publish variations in capital goods volumes depending on where these automotive imports are found.

But the truth is that the amount paid abroad is similar to 2017, when 18,500 vehicles and about 66,500 motorcycles were sold that year, a goal set by the now defunct Nicaraguan Association of Motor Vehicle Distributors (Andiva) . The sector’s target in 2013 was to market 18 thousand units.

In fact, the amount of the banking system’s credit portfolio for the purchase of vehicles increased by almost three million cordobas during 2023. However, the amount of current debt was about half that reported by the Superintendent of Banks and Other Financial Institutions (Siboif) at the end of 2019.

Also read: Gold makes Canada Nicaragua’s third export market in 2023

Vehicles most imported

According to the foreign trade report recently published by the Central Bank, total imports of goods during 2023 stood at $8,326.1 million, showing an increase of 4.4 percent compared to 2022. This increase was achieved by an increase of 17.8 percent. Purchases of capital goods, mainly driven by higher purchases of transportation equipment, were $192 million more than in 2022.

According to the BCN report, during 2023, $286.13 million was invested to bring from abroad dump trucks, which are mainly used in construction, minibuses used to transport passengers, and Vans are mainly used in agricultural activity, which is respectively predominant in the country. This amount is the highest in the last seven years and is 80 percent better With respect to 157.84 million spent on the import of these vehicles during 2017, that is, before the onset of the socio-political crisis that still affects the country and which was exacerbated by the impact of the Covid-19 pandemic.

Recently, the National Port Company (EPN) showed photos of the unloading of one of the first imported vehicles of 2024. This is a batch of 600 Nissan brand vans.

You can also read: Ortega forces Nicaraguans to buy the most expensive gasoline in Central America

Motorcycles constitute the majority in the vehicle park

The second group of vehicles that recorded the greatest growth in imports were motorcycles, which in recent years have become a means of work for thousands of Nicaraguans, who use them to carry out a variety of deliveries and household services. According to BCN report, last year $85.71 million was allocated to bring motorcycles from abroad. This figure is also the highest in the last seven years and is top 64 percent 52.25 million allocated for these imports in 2017.

In fact, motorcycles have grown the most in the country’s vehicle fleet. According to the statistical yearbooks of the Ministry of Transport and Infrastructure (MTI), Nicaragua’s vehicle fleet was 876,727 vehicles in 2017. Of the total, 88.55 percent were light and included motorcycles; 8.13 percent were heavy vehicles, 2.91 percent were passenger vehicles, and 0.41 percent were other types of vehicles.

Although in recent years the MTI has not republished its yearbooks and there are no updated figures for the previous year, during an interview given to the official media by the national head of transit, General Commissioner Wilma Reyes, in January 2023, she detailed reported that by 2022, the vehicle fleet was to grow to 1.15 million vehicles and a total of 600,000 of them were motorcycles. That is, in 2022, motorcycles represent almost half of the country’s entire vehicle fleet and this figure is close to all light vehicles present in 2017.

You can also read: Are Nicaraguans buying more vehicles or are they entering Nicaragua at a higher price? you pay more to import them

Bus imports dropped 27%

Third in line for growth in the vehicle segment were imports of quadricycles for recreational use on beaches and sedan-type automobiles for personal use in cities. In 2023, $176.48 million was spent on these purchases. This amount is also the highest in the last seven years and is top 31 percent In 2017, 134.43 million were used to import this type of vehicles.

In a clear example, Daniel Ortega last year negotiated the purchase of more than a thousand Yutong brand buses with China to replace the fleet of units providing mass urban transportation (TUC) in the capital and the country’s interior. Not recorded in import, submits BCN report 27 percent declineCompared to 2017 in the import of buses.

The report notes that $17.94 million was allocated for the import of buses in 2017, but only $13.04 million was spent on these units used for passenger transportation last year. The Yutong brand buses that came to the country from China last year, depending on their specifications and capacity, cost between 20 thousand to 25 thousand dollars, so their purchase will cost between 20 to 25 million dollars, not 13.04 million. BCN reported for the report. Import of buses.

More debt than 2022

Buses with van-type trailers, harrows and crane trucks are the vehicles that recorded a decrease in their import volumes during 2023; The amount invested in importing some engine spare parts was also reduced.

But in general, imports of vehicles and spare parts recorded an 86 percent increase last year compared to 2022, as it rose from 512.54 million to 704.54 million in 2023. But if last year’s amount is compared with the Rs 505.35 million invested in these imports in 2017, the increase is 40 percent.

Meanwhile, in another example of the dynamism recorded last year in the sector, the Superintendent of Banks and Other Financial Institutions (Siboif) reports that as of December 31, 2023, the amount of credit applicable for the purchase of vehicles was more than . 2,574 compared to 14,163 applicable on the same date in 2022. However, this is significantly lower than the 28,347 implemented at the end of 2017.

It should be noted that out of 16,737 vehicle loans applicable at the end of 2023, only 25 were disbursed in national currency and 16,712 in dollars.

US$80 million more to buy vehicles

This increase in the volume of credit caused the credit portfolio for this type of financing to increase from 5,132 million Cordobas in 2022 to 16,737 million last year; That is, an increase of 2,963 million cordobas (about 80 million dollars at the official exchange rate).

These increases show that despite the order last March by Daniel Ortega to close the Nicaraguan Association of Motor Vehicle Distributors (Andiva), an organization that was characterized by promoting automobile fairs, group and individual fairs organized by automobile dealers, Vehicles Last year, with the continuous campaigns run by banks among their customers, offering financing for the purchase of vehicles, or promoting their purchase through consumer loans or credit cards, the sector grew by about 18 thousand rupees last year. Helped us reach our target of selling units.

(tagstotranslate)endiva | Nicaraguan Association of D

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