Used cars, certified aftermarket parts seen as opportunities in Ghana

March 7, 2017
If you want to do business in Ghana, the West African nation’s drivers would welcome pre-inspected quality used vehicles, preferably with a high ground clearance, plus quality aftermarket repair parts at bargain price points.

If you want to do business in Ghana, the West African nation’s drivers would welcome pre-inspected quality used vehicles, preferably with a high ground clearance, plus quality aftermarket repair parts – with both elements proffered at bargain price points.

Low-cost technician training courses are another need to augment the skills of omnipresent “roadside mechanics” who keep the current car parc running under rough road conditions and a tough economy.

A successful parts-sales import initiative would improve its chances of success by including a certification process guaranteeing legitimacy, as counterfeit components are a continuing problem.

“From what I know and experience, most drivers purchase aftermarket parts more than OEM parts due to affordability and difficulty in determining genuine parts from fake parts. Up to 60 percent of drivers will go in for aftermarket parts rather than genuine parts,” says Samuel Kwesi Sackey, vice president of ECL, which provides testing services for Ghana’s vehicle inspection program. (See the related Q&A with Sackey here).

Using the country’s common term for used vehicles, Sackey explains to Aftermarket Business World that “the majority of vehicles on Ghana roads are ‘grey cars’ compared to new cars. As a result, it does increase the demand for spare parts. Most used vehicles that are imported into Ghana are already broken down before they arrive and need to be fixed before use.”

In addition to the quality issues presented by used cars, at times the accompanying documentation can be dicey, generating concerns that the paper trial for important recall notices may be incomplete.

“As technology changes rapidly, customers who are not recorded in the manufacturer’s database will not avail themselves of the opportunity to gain from the latest technologies in the auto industry with regards to repairs and maintenance. In case of any manufacturing defect, their vehicles may not be recalled for prompt and proper maintenance,” reports Fauster Abasa-Addo, an “auto sales and engineering expert” who analyzed the nation’s automotive segment for the GhanaWeb news service. In addition, “There are instances where radiators are found to be too small, thereby increasing the incidence of overheating, especially in the afternoons.”

“Used vehicles do break down more often,” says Sackey, “and that increases the demand for spare parts.”

The situation is further exacerbated by the punishment dished out by the jarring roads upon which most vehicles travel. Roughly the size of Oregon, Ghana has about 68,000 miles of roadway, and nearly 60,000 miles of them remain unpaved.

“The conditions of roads in Ghana are not up to standard,” Sackey says. “Most roads in Ghana are full of pot holes that are very dangerous for road users and pedestrians, and it causes a lot of breakdowns of vehicles.” A large number of speedbumps – installed because many drivers exceed speed limits, fail to obey stop signs and disregard other traffic regulations – is a further cause of vehicle damage.

“The nature of the Ghanaian terrain requires extra protection,” according to GhanaWeb columnist Bonus Williams. “Made-for-Ghana vehicles thus come equipped with a rough road/severe usage package like reinforced suspensions, a suitable vehicle ground clearance, heavy duty shock absorbers and reinforced bushings. Vehicles for European markets do not have these additional features. Many vehicles not meant for our environment are being imported.”

Williams observes that “instead of desired values, users have to grapple with increasing stress levels involved in the usage of the used imported cars. Due to the quality of these used imports, the maintenance cost is usually very high, thereby creating financial nightmares for users. And a disturbing aspect is the distrust which customers develop for the genuine brand holders, thereby affecting the economic fortunes of the authentic auto brand builders.”

“Vehicles that survive for long periods of time on our roads are mostly 4x4 vehicles and vehicles that have high clearance from the ground,” says Sackey. Close to 70 percent of the used vehicles are imports sourced by non-OEM-connected dealers through Europe, the U.S. and Canada.

“Ghanaians prefer vehicles with American specifications,” he says, but an acutely desired trait – often sought in vain by used vehicle buyers on tight budgets – is rugged-road reliability.

The most common used models purchased in Ghana, according to Sackey, are the Toyota Corolla, Chevrolet Cruze, Pontiac Vibe, Toyota Matrix, Toyota Camry, Toyota Highlander, Hyundai Sonata, Hyundai Elantra, Hyundai Accent, Hyundai Santa Fe, Kia Bongo, Mercedes-Benz Sprinter, Mercedes C Class, Nissan Pathfinder, Nissan Sentra, Nissan March and the Kia Sportage. Vehicles from the old Soviet Union also have a presence.

Popular new nameplates are the Toyota Corolla, Toyota Camry, Toyota Hilux, Toyota Land Cruiser, Mitsubishi L200, Nissan Navara and the Hyundai Sonata. In addition, India’s Mahindra manufactures vehicles in Ghana for the domestic market along with export sales.

Ghana’s solo truly domestic automaker is Kantanka, which began production in November 2015. Currently the line of both electric and internal combustion models is mostly destined for governmental use.

“They are still trying to enter the market to produce more for the general public,” says Sackey, adding that “there are people that can afford new cars, but the majority go in for second-hand vehicles due to affordability.”

Established by noted religious leader Apostle Dr. Kwadwo Safo, Kantanka’s goal is to “ensure that Ghana, Africa and the world-at-large have access to our indigenous brand of vehicles made with extreme caution and attention to detail,” says company executive Kwadwo Safo Jr., speaking to the Joy News radio network when inaugurating production.

Kantanka “is commencing the next step in its quest to achieve our vision, which is to see Ghana and Africa participating in the global automotive industry as a manufacturer rather than consumer and after-sales service provider,” he added.

Ghanaian drivers are attracted to electric vehicles, however they are mainly restricted to light duty urban errands. A current lack of current is another issue, one that has an impact on the entire nation’s economy. With a population of 27.7 million, 7.3 million of Ghana’s citizens – fully half of all its rural residents – live without any electricity, a problem that the government is trying to remedy despite limited economic resources that curtail inroads into infrastructural improvements.

Golden opportunities

A former British colony known as the Gold Coast, located on the Gulf of Guinea, Ghana was the first primarily black nation in sub-Saharan Africa to gain independence from colonial rule in 1957. (A UK-influenced version of English is the official language.) And life can be hard in Ghana, which has a history of droughts, floods, civic unrest and other calamities such as a rampant AIDS epidemic. The average life expectancy hovers at 66 years, compared to 78 years-plus in the U.S. (Japan has the world’s highest life expectancy at nearly 84 years.)

Ghana’s consumer prices are on-average 19.3 lower than those found in America, yet analysts at the U.S. Department of Commerce’s International Trade Administration (ITA) report that a burgeoning middle class presents investment possibilities for the automotive sector.

Despite Ghana’s British background, vehicles there are left-hand drive, “opening up significant export opportunities for U.S.-manufactured passenger and commercial vehicles,” according to the ITA. Reliable and relatively frequent shipping routes between U.S. East Coast ports and Ghana is another positive factor, as is demand for a wide range of specialty vehicles including mining and construction equipment, trucks outfitted for working on the growth-oriented electrical grid, garbage trucks and other infrastructural and industrial applications.

“Like much of Africa, the Ghana market is highly price sensitive. Buyers, both private consumers and industrial users, are likely to see greater value in used or reconditioned equipment than newly manufactured, more expensive, products. In recent years used passenger vehicles has been the largest category of goods exported from the U.S. to Ghana,” the ITA says. “A number of Ghanaian buyers have traveled to the United States in recent years to purchase used vehicles from U.S. auto auction companies.”

A general trend cited by the ITA is a shift toward vehicles with a smaller engine capacity; five-door cars are generally preferred over three-door cars. And although smaller in size, within Ghana’s new vehicle market American-made sedans and SUVs are becoming increasing popular because “it is easier to obtain replacement parts than was previously the case.”

Subscribe to Aftermarket Business World and receive articles like this every month….absolutely free. Click here.

Sponsored Recommendations

ZEUS+: The Cutting-Edge Diagnostic Solution for Smart, Fast, and Efficient Auto Repairs

The new ZEUS+ simplifies your diagnostic process and guides you through the right repair, avoiding unnecessary steps along the way. It gives you the software coverage, processing...

Diagnostic Pre- and Post-scan Reports are Solid Gold for Profitability

The following article highlights the significance of pre-scans and post-scans, particularly with Snap-on scan tools, showcasing their efficiency in diagnosing issues and preventing...

Unlock Precision and Certainty: TRITON-D10 Webinar Training for Advanced Vehicle Diagnostics

The TRITON-D10 lets you dig deep into the systems of a vehicle and evaluate performance with comparative data, systematically eliminating the unnecessary to provide you with only...

APOLLO-D9: Trustworthy Diagnostics for Precision Repairs

The APOLLO-D9 provides the diagnostic information and resources you need to get the job done. No more hunting through forums or endlessly searching to find the right answers. ...

Voice Your Opinion!

To join the conversation, and become an exclusive member of Vehicle Service Pros, create an account today!